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Karnataka High Court · body

2025 DIGILAW 2043 (KAR)

R. Veeramani, S/o. S. P. Rangaswamy Chairman v. Anandgouda, S/o. Basanagouda Patil

2025-12-19

ANANT RAMANATH HEGDE

body2025
ORDER : ANANT RAMANATH HEGDE, J. 1. The petition is filed assailing the order dated 14.10.2024 in Misc. Appeal No.4/2024 on the file of IV Additional District Judge, Ballari. 2. In terms of said order, the impugned order dated 10.01.2024 passed by the Regional Labour Commissioner, Ballari directing payment of wages is confirmed. 3. The petitioner has also sought to quash the recovery certificate marked at Annexure-C dated 15.05.2024 issued by the Regional Labour Commissioner. 4. In terms of the order dated 10.01.2024, the Regional Labour Commissioner has allowed the claim petition dated 10.06.2022 filed under sub-section (2) of Section 15 of the Payment of Wages Act, 1936 (‘Act, 1936’). The Regional Labour Commissioner has directed the petitioner-Company to pay Rs.3,74,15,171/- to 72 applicants towards delayed wages from May 2020 to November 2022 (31 months). In addition, directed the petitioner-Company to pay compensation of Rs.3,000/- to each of 72 applicants named in the order. 5. Certain facts are admitted. The respondents were the workers under the petitioner which is a Company involved in granite business. The petitioner had quarry licence issued by the Department of Mines and Geology, Government of Karnataka which was valid for 20 years from 17.09.1999. On 24.09.2019, the petitioner issued a letter suspending the quarrying activities and intimation was submitted to Regional Provident Fund Commissioner, Raichur. On 08.11.2019, the petitioner claims to have filed Form No.1 intimating suspension of mining activities to the Director of Safety, Ballari on 01.04.2020. 6. The petitioner issued a general notice relating to stoppage of mining activity. Petitioner also issued a letter in Form-A to the Regional Labour Commissioner, Ballari. 7. The petitioner contends that it could not carry on mining activities as the licence to carry out mining activities was not renewed by the competent authority. It is urged that the order passed by the Regional Labour Commissioner to pay the wages is without jurisdiction and the dispute if any has to be adjudicated under the provisions of the Industrial Disputes Act, 1947. 8. The learned counsel appearing for the petitioner would urge that respondents themselves have contended that for certain period, the petitioner-Company was closed and urged that same amounts to lay-off. 8. The learned counsel appearing for the petitioner would urge that respondents themselves have contended that for certain period, the petitioner-Company was closed and urged that same amounts to lay-off. Even if it is accepted for the sake of argument that it was a case of either a closure or a lay-off, then the dispute has to be adjudicated under the Industrial Disputes Act, 1947 and the Regional Labour Commissioner under the Act, 1936 has no jurisdiction to pass the impugned order. 9. Learned counsel for the petitioner would also urge that assuming that the act of the petitioner-Company amounts to refusal of employment, still the Regional Labour Commissioner under the Act, 1936 does not get the jurisdiction to entertain the dispute, as such dispute relating to refusal of employment has to be raised before the competent Labour Court. 10. It is also urged that admittedly 73 workers in whose favour, the order is passed to pay the wage for 31 months, did not work for 31 months and the Act, 1936 does not apply in such a situation and the provisions of the Act can be invoked only if the employees had worked and wages are not paid or short paid or paid belatedly. 11. Learned counsel appearing for the respondent would urge that the Regional Labour Commissioner and the learned District Judge rightly came to the conclusion that the provisions of the Industrial Disputes Act, 1947 relating to lay- off and closure or retirement/retrenchment are not followed and the petitioner-Company is very much in existence and the respondents/employees are not removed from employment, and since they continued to be in the muster roll of the petitioner-Company, the authorities were justified in directing the payment of wages. 12. It is also urged that the mining activity is not permanently closed. It is temporarily closed primarily because of Covid-19 related restrictions as such, the authorities were justified in passing the orders. It is also urged that admittedly the respondents are not paid the wages for 31 months as such, there is no dispute to be adjudicated by the Labour Court and the Regional Labour Commissioner has rightly exercised the jurisdiction. 13. The Court has considered the contentions raised at the Bar and perused the records. 14. Admittedly, the respondents filed application under Section 15(2) of the Act, 1936. Section 2 of the Act, 1936 defines the term “wages”. 15. 13. The Court has considered the contentions raised at the Bar and perused the records. 14. Admittedly, the respondents filed application under Section 15(2) of the Act, 1936. Section 2 of the Act, 1936 defines the term “wages”. 15. The authority under the Act has the jurisdiction to direct payment of wages in case the wages are not paid as prescribed under the Act, 1936. Under Section 4 of the Act, the payment of wages shall not be deferred beyond one month. 16. The definition of “wages” under the Act, 1936 reads as under:- “2. Definitions. 15. The authority under the Act has the jurisdiction to direct payment of wages in case the wages are not paid as prescribed under the Act, 1936. Under Section 4 of the Act, the payment of wages shall not be deferred beyond one month. 16. The definition of “wages” under the Act, 1936 reads as under:- “2. Definitions. —In this Act, unless there is anything repugnant in the subject or context,— (vi) “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 a person employed in respect of his employment or of work done in such employment, and includes- (a) any remuneration payable under any award or settlement between the parties or order of a Court; (b) any remuneration to which the person employed is entitled in respect of overtime work or holidays or any leave period; (c) any additional remuneration payable under the terms of employment (whether called a bonus or by any other name); (d) any sum which by reason of the termination of employment of the person employed is payable under any law, contract or instrument which provides for the payment of such sum, whether with or without deductions, but does not provide for the time within which the payment is to be made; (e) any sum to which the person employed is entitled under any scheme framed under any law for the time being in force, but does not include— (1) any bonus (whether under a scheme of profit sharing or otherwise) which does not form part of the remuneration payable under the terms of employment or which is not payable under any award or settlement between the parties or order of a Court; (2) the value of any house-accommodation, or of the supply of light, water, medical attendance or other amenity or of any service excluded from the computation of wages by a general or special order of 2 [appropriate Government]; (3) any contribution paid by the employer to any pension or provident fund, and the interest which may have accrued thereon; (4) any travelling allowance or the value of any travelling concession; (5) any sum paid to the employed person to defray special expenses entailed on him by the nature of his employment; or (6) any gratuity payable on the termination of employment in cases other than those specified in sub-clause (d).]” (emphasis supplied) 17. On a reading of this provision, it is evident that to earn the wages, one has to comply with the terms of employment either express or implied and payable to the person employed in respect of his employment or of work done in such employment. In other words, to be entitled to the wages, one has to fulfill the terms of employment i.e., employee has to work. 18. Admittedly, in the 31 months in question, the respondents did not work as the petitioner did not have the licence to carry on the mining business as the mining licence was not renewed by the competent authority. Under these circumstances, the petitioner informed the competent authority about the temporary closure of the business. 19. The fact that the mining activity did not take place during that period is not a dispute at this juncture. It is not the case of the respondents that despite non renewal of licence, the mining activity continued and they were made to work in the said period. 20. Admitted factual position is, the licence was not renewed, mining activities stopped and stoppage of activity was duly informed to the competent authority. This being the position, there is no difficulty in holding that the respondents did not work during the said 31 months period. 21. Under these circumstances, the denial of work may amount to a lay-off or denial of employment. In such an event, the respondents have to raise an industrial dispute and the competent Labour Court or the Tribunal has to adjudicate the dispute. Section 15 of the Act, 1936 reads as under:- “15.Claims arising out of deductions from wages or delay in payment of wages and penalty for malicious or vexatious claims. —[(1) The appropriate Government may, by notification in the Official Gazette, appoint— (a) any Commissioner for Workmen's Compensation; or (b) any officer of the Central Government exercising functions as,— (i) Regional Labour Commissioner; or (ii) Assistant Labour Commissioner with at least two years? experience; or (c) any officer of the State Government not below the rank of Assistant Labour Commissioner with at least two years? experience; or (c) any officer of the State Government not below the rank of Assistant Labour Commissioner with at least two years? experience; or (d) a presiding officer of any Labour Court or Industrial Tribunal, constituted under the Industrial Disputes Act, 1947 (14 of 1947) or under any corresponding law relating to the investigation and settlement of industrial disputes in force in the State; or (e) any other officer with experience as a Judge of a Civil Court or a Judicial Magistrate, as the authority to hear and decide for any specified area all claims arising out of deductions from the wages, or delay in payment of the wages, of persons employed or paid in that area, including all matters incidental to such claims:" (emphasis supplied) 22. The jurisdiction of the authority under Section 15 is well defined and the authority can adjudicate the dispute arising out of deduction from wages or delay in payment of wages. 23. In the instant case, it is not a case of deduction or delay in payment of wages as the petitioner is contending that the wages as admittedly employees did not work. Under these circumstances, the Court is of the view that the Regional Labour Commissioner did not have a jurisdiction to decide the question as to whether the respondents are entitled to claim wages for 31 months when admittedly they did not work during 31 months. 24. Learned counsel for the respondents has relied on the judgment in J.N Srivastava v. Union of India and Another (1998) 9 SCC 559 . In the said case, the Court was dealing with entitlement of employee who withdrew his offer for voluntary retirement and thereafter who was not allowed the work. In the said circumstances, the Court said “no work no pay” principle would not apply. That was not the case falling under the Payment of Wages Act. 25. In Punjab National Bank v. Virender Kumar Goel (2004) 2 SCC 193 , the Court dealt with the principle of “no work no pay” in the backdrop of withdrawal of voluntary retirement and consequent denial of work. 26. In Shobha Ram Raturi v. Haryana Vidyut Prasaran Nigam Ltd. (2016) 16 SCC 663 and United India Insurance Co. Ltd. v. Siraj Uddin Khan (2019) 7 SCC 564 , the Court dealt with the principle of “no work no pay” in the context of invalid retirement. 27. 26. In Shobha Ram Raturi v. Haryana Vidyut Prasaran Nigam Ltd. (2016) 16 SCC 663 and United India Insurance Co. Ltd. v. Siraj Uddin Khan (2019) 7 SCC 564 , the Court dealt with the principle of “no work no pay” in the context of invalid retirement. 27. In none of these cases, the adjudication was under the Payment of Wages Act, 1936. 28. In Payment of Wages Inspector v. Surajmal Mehta ( AIR 1969 SC 590 ) and Ambica Mills v. S.B. Bhatt ( AIR 1961 SC 970 ) , the Apex Court has dealt with the scope of the Authority under Section 15 of the Payment of Wages Act. In Managing Member, M/s. Nirmal Industries v. Naseemuddin  (1965 SCC OnLine AP 208) , the Apex Court has held that jurisdiction under Section 15 is limited and confined to the wages not paid or deferred in a situation where the employee has earned the wages. 29. In the instant case, admittedly, no work was extracted from the employees. Hence, the dispute has to be raised under the Industrial Disputes Act. 30. Learned District Judge has come to the conclusion that the act of the petitioner amounts to closure of industry and procedure contemplated under Section 25(o) of Industrial Disputes Act is not followed and directed payment of wages confirming the order of the Regional Labour Commissioner. Assuming that the case falls under Section 25(o), then also the Regional Labour Commissioner will not have the jurisdiction. 31. For the aforementioned reasons, the impugned orders are not sustainable. Hence, the following: ORDER (i) The writ petition is allowed. (ii) The judgment and order dated 14.10.2024 passed in Miscellaneous Appeal No.4/2024 on the file of IV Additional District Court, Ballari is set-aside. (iii) Consequently, the order dated 10.01.2024 passed in Claim Application No.01/2022/RLC/BLY by the Regional Labour Commissioner (Central), Bellary, is set-aside. (iv) Liberty is reserved to the respondent/workman to raise the Industrial Dispute. If such a dispute is raised, the time spent in proceedings before the authorities under the Payment of Wages Act, the District Court and this Court has to be excluded in computing the limitation, if any. (v) The amount in deposit shall be released in favour of the petitioner. The bank guarantee is discharged.