JUDGMENT
B.N. Srikrishna, J.
1. This petition, though purported to be filed under Articles 226 and 227 of the Constitution of India, on the appellate side of this Court, can conveniently be disposed of by treating it substantially as a petition under Article 227 of the Constitution. Since the reliefs claimed in the petition can be granted by treating it substantially as a petition under Article 227, I have done so.
2. The petitioner filed an application for approval of the action of dismissal taken against the second respondent-workman by an order dated 4th April, 1978. The application for approval of the action became necessary, as, at the relevant time, an industrial dispute vide Reference (IT) No. 523 of 1975 was pending before the Industrial Tribunal. As required by Section 33(2)(b) of the Industrial Disputes Act, 1947 (hereinafter referred to as “the Act”), as parts of the same transaction, the petitioner issued the Order of Dismissal dated 4th April, 1978, despatched to the workman a sum of Rs. 707.20, purported to be a month’s wages as payable under Section 33(2)(b) of the Act, and simultaneously filed an application for approval of the action as contemplated under the proviso to Section 33(2)(b) of the Act. The application was opposed by the respondent-workman on several grounds, including, inter alia, on the ground that it was in contravention of the provisions of Section 33, in that the petitioner had neither unconditionally tendered nor paid the full sum of the one month’s wages due to the workman, inasmuch as an amount of Rs. 40, which represented the House Rent Allowance, had not been included in the amount sent to him by money order. The respondent-workman also contended that the application made by the petitioner was barred by the principle of res judicata, as an earlier application made by the petitioner for permission to discharge or dismiss the respondent-workman under the provisions of Section 33(2)(b) of the Act had been dismissed. The application was also opposed on merits by contending that the order of dismissal passed was in contravention of the Standing Orders, the inquiry was bad in law and did not comply with principles of natural justice, the punishment was disproportionate etc.
3. The application for approval was filed on 4th April, 1978. On 19th August, 1981, the petitioner made an application to the Tribunal, in which the petitioner took up the stand that, though Canteen Subsidy, House Rent Allowance and Leave Travel Assistance had not been included in one month’s wages, as, according to it, these were not properly includable, without prejudice to the said contention, the petitioner stated that it was unconditionally prepared to pay the said amount by deposit of the shortfall in Court, if so ordered by the Tribunal. On 20th August, 1981, the petitioner filed another application before the Tribunal quantifying the various amounts which
would have to be included in one month’s wages, if the workman’s contentions were upheld. I shall ignore the Leave Travel assistance and Canteen Subsidy (as even the Tribunal has held that these were not legally includable in the one month’s wages payable under Section 33(2)(b) of the Act) and concentrate upon the quantum of House Rent Allowance, which was indicated to be Rs. 40/- as on the date of the dismissal of the second respondent, and Rs. 70/-, as on the date of application. The Tribunal passed no order on either of these applications.
4. After recording detailed evidence on all aspects of the matter, the Tribunal came to the conclusion that the Enquiry Officer had held the enquiry in consonance with the principles of natural justice and had given reasonable opportunity, and, therefore, the enquiry held was legal and proper. It also held that a prima facie case for approval of the action of dismissal had been made out by the petitioner. Dealing with the technical contention of res judicata, the Tribunal rejected it by holding that the earlier application which had been rejected was based on a different cause of action and not on identical facts, that there was difference in the nature of reliefs sought and the jurisdiction to be exercised in the two proceedings, viz., proceeding under Section 33(2)(b) and proceeding under Section 33(2)(b) of the Act. It is the other technical objection about failure to comply with the provision of Section 33(2)(b), which appealed to the Tribunal, which upheld the contention and dismissed the application. The petitioner has challenged the Tribunal’s aforestated order rejecting the application for approval made by it.
5. It was conceded by the learned advocate appearing for the second respondent before the Tribunal that the petitioner has remitted an amount of Rs. 707.20 by postal money order on 29th November, 1976 and that amount was not accepted by the second respondent-workman, as, according to him, there was a shortfall in the statutory amount of one month’s wages payable, as the said amount did not include, inter alia, the amount of Rs. 40/- payable as House Rent Allowance, earning of Leave Travel Assistance and earning of Canteen Subsidy. It was further conceded that Leave Travel Assistance could not be deemed to be a part of the “wages” within the meaning of the said expression as defined in Section 2(rr) of the Act. The Tribunal took the view that the facility of Canteen Subsidy could be availed of by workman on duty and not by any other workman who was on leave or who was notionally on leave, but not on active duty. It, therefore, held that Canteen Subsidy also did not legitimately form part of one month’s wages under Section 33(2)(b) of the Act.
6. The only ground on which the Tribunal held that there was contravention of Section 33(2)(b) of the Act was that an amount of Rs. 40/- per month, payable as House Rent Allowance, had not been included in the said amount of Rs. 707.20 sent to the respondent workman as purportedly one month’s wages, mandatorily required to be paid under the proviso to Section 33(2)(b) of the Act. The Tribunal examined the terms of employment pertaining to House Rent Allowance, as incorporated in Clause 7 of the Settlement dated 28th September, 1973, and took the view that H.R.A. payable thereunder was a part and parcel of the wages and ought to have been properly included in the amount of one month’s wages payable under the proviso to Section 33(2)(b) of the Act.
7. Mr. Parakh, learned counsel for the petitioner, impugned the above finding of the Tribunal by citing, the judgment of this Court in Balmer Lawrie & Co. Ltd v. Woman B. More and Anr. 1981(42) FLR 272, and the judgment of the Supreme Court in Bharat Electronics Limited, Banglore v. Industrial Tribunal, Bangalore and Anr. 1990 II LLJ 32 His contentions are two fold. First, he submitted that, if the judgement of the learned single Judge in Balmer Lawrie’s case (supra) is assumed to hold the field, then there is sufficient and substantial compliance with the rule laid down therein, and, therefore, the Tribunal ought to have held, in favour of the petitioner that there was no contravention of the mandatory duty to pay one month’s wages within the meaning, of the proviso to Section 33(2)(b) of the Act. Alternatively, he contended that the judgment in Bharat Electronic case (supra) overrules the judgment of this Court in Balmer Lawrie’s case. In Bharat Electronics ‘ case the Supreme Court has held that there is no invariable rule that the expression ‘wages’ used in the proviso to Section 33(2)(b) should be interpreted only with reference to the statutory definition in Section 2(rr) of the Act, A statutory definition must be adopted in interpreting the terms used in the statute unless there is something repugnant in the subject or context. It is urged that the Supreme Court has taken the view in Bharat Electronic’s case that an allowance like Shift Allowance, earned only by working during night shift, would not necessarily form part of “wages” for the purpose of application of the proviso to Section 33(2)(b) of the Act. The said principle should hold good and apply with equal rigour to the petitioner’s case, in the submission of the learned counsel for the petitioner.
8. Apart from these two contentions, the petitioner has also canvassed in the petition, and contended through its counsel in Court, that, even if the Court comes to the conclusion that the application of the petitioner must fail because of failure to comply with the requirement of payment of one month’s wages, such breach would only be a technical breach and would not result in automatic liability to reinstate the respondents workman and/or to pay him full back wages. The decision of the Supreme Court in Punjab Beverages Pvt. Ltd, v. Suresh Chand and Anr. 1978 II LLJ. I is pressed into service in support of this contention.
9. Turning to the first contention of Mr. Parakh, I am of the view that this contention cannot be accepted. Mr. Parakh urged that, despite the apparent gap in time between so the application, dated 14th April, 1978, and the purshis filed in Court on 19th and 20th August, 1981 the case falls within the ambit of the rule in Balmer Lawrie’s case and that the Court must hold that there is substantial compliance with Section 33(2)(b) of the Act. In Balmer Lawrie’s case, a similar situation was considered by a learned single Judge of this Court. In that case also, there was a shortfall in the payment of one month’s wages as the employer had not included certain amounts payable to the workman by way of H.R.A., Canteen Subsidy, Shift Allowance and Production Bonus. The Tribunal accepted this contention, and held that H.R.A. of Rs. 67/- per month and Shift Allowance of Rs. 1.25 per day formed part of the ‘wages’ of the workman, and that there was failure on the part of the employer to pay the same. This amounted to contravention of the mandatory requirement imposed under Section 33(2)(b) of the Act, and, consequently, the Tribunal rejected the application for approval for non-compliance with the provisions of Section 33(2)(b). In repelling the contention raised by the employer that non-inclusion of the aforestated amount in the workman’s wages was a bona fide error and the employer ought to be given an opportunity to rectify the procedural lapse, if any, the learned single Judge of this Court observed in paragraph 7, as under:-
“However, a fundamental question does arise. In this case, it is impossible to accept the contention of the employer that non-payment of House Rent Allowance was bona fide action on proper advice. However, there may be occasions when the amount paid, tendered or remitted to the workman falls short of the amount which may ultimately be found payable to the workman, but the difference arises because of some difficulty or inability to make the necessary calculation at a particular point of time which difficulty or inability gets removed subsequently. The shortfall may also arise in case where two views are possible on the employer’s liability to pay certain amounts to the workman. For example, we may have a case where an employer in Bombay is faced with two conflicting decisions of other High Courts which have taken diametrically opposite views.”
In order to ameliorate the hardship that may be caused to an employer who has made a bona fide error in calculating one month’s wages, on account of a bona fide doubt, the Court then enunciated the following principle (vide paragraph 8):-
“In such cases I think the employer will be entitled to some consideration if in his application for permission he were to bring these facts and contentions to the notice of the Tribunal and make an offer to deposit the disputed amount before the Tribunal either along with the application or within such time as the Tribunal may order with a further offer that the same may be paid to the employee “as with a further offer that the same may be paid to the employee as and when directed by the Tribunal. In case an item cannot be precisely calculated at or before the time when the application is made, for example payment in the nature of production or incentive bonus, then the offer may be made, but the precise amount would be required to be deposited or offered to be deposited immediately the calculation is feasible. It is possible in such a case to hold that although the actual amount may not have been paid to the workman immediately, the employer has because of a genuine bona fide difficulty not complied with the provisions but has indicated his willingness to comply with the same and for the purpose has sought specific directions from the Tribunal whose per-mission he has been seeking. It is in this limited context only that some relief from the procedural requirements of Section 33(2)(b) can be envisaged. It can never be envisaged where the non- payment is of an item such as House Rent Allowance which very clearly falls within the meaning of wages as defined. Any advice given to the employer that such amount was not payable cannot be accepted as bona fide advice, nor can the employer’s action on such advice be acceptable as bona fide. Even as regards the other items, by not mentioning them in the application for permission the employer has put himself beyond the pale or equitable application of Section 33(2)(b). In any case, it was not open to the employer to seek to rectify his mistake at the stage of reply to the written statement. A prudent employer knows from the previous emoluments paid to the employee what that employee had been paid in the previous months and what the various constituents of that payment are. In respect of the admitted amounts payment or tender would be made. In respect of the other amounts if there is any genuine or bona fide dispute it must be brought to the notice of the Tribunal at the stage of making the application for permission and an unconditional offer should be made to the Tribunal to deposit the said amount and even to pay the same subject to any direction for security or otherwise to be made by the Tribunal. Such an employer may perhaps be entitled to obtain permission despite a shortfall in initial payment”.
After having laid down the principle thus, the Court held against the employer, as it was not satisfied on facts that it was a bona fide mistake on the part of the employer, which was rectified at the earliest available’ opportunity by expression of a genuine desire to pay full wages payable to the workman.
10. Mr. Parakh contends that this principle was laid down by our Court, or, for that matter, by any Court, for the first time, by the judgment in Balmer Lawrie ‘s case. Prior to that, the law, as understood, was that the shortfall in payment of the mandatorily required amount of one month’s wages would invariably invalidate the application for approval under Section 33(2)(b). The rigour of this position in law was softened by the principle enunciated in Balmer Lawrie’s case that this was the principle became known only after this judgment was delivered, which was some time in February, 1981. Though the judgment was delivered in February, 1981, the judgment became known only by or about August, 1981, and upon coming to know of the principle laid down in this judgment, the petitioner immediately moved its application (on 19th August, 1981) before the Tribunal. Thus, there was no delay, no laches, no failure of the petitioner to express its genuine desire to make good the shortfall, thus urged the learned counsel. In my view, this submission cannot be accepted. As rightly urged by Mr. Kochar, learned counsel for the second respondent, when the Court interprets a statutory pro-vision, it is not making law which operates from the date of its judgment. The principle, as accepted in our jurisprudence, is that the Court explains or expounds the law and does not bring the law into existence, which is the proper function of the competent Legislature. Any exposition of the law made by the Court would, therefore, relate back to the date from which the statute became operative. This contention is correct and needs to be upheld. I am unable to persuade myself to the view that the rule in Balmer Lawrie ‘s case must be deemed to have come into effect only in February 1981, as contended by Mr. Parakh. We cannot lose sight of the tact that the Legislative mandate contained in the proviso to Section 33(2)(b) requires the employer to make payment of one month’s wages pari passu with the order of dismissal. It is only in the case of a legitimate or bona fide dispute that the employer has been given some kind of leeway of rectifying the shortfall immediately in Court. This concession, therefore, cannot be availed of by an employer who makes the offer to rectify the shortfall after a period of more than three years. The contention must, therefore, fail and is rejected.
11. In my view, it is unnecessary to express any opinion as to whether the judgment of the Supreme Court in Bharat Electronics case can be said to overrule the judgment of this Court in Balmer Lawrie’s case as, on facts, I am satisfied that the petitioner’s contention based on the Supreme Court judgment in Bharat Electronic’s case has to be rejected. In Bharat Electronic’s case, the situation was that the workman, who was entitled to payment of Shift Allowance, payable under the terms of the employment only for working during night shift, had not been paid an amount of Rs. 12/-, which was legally includable to his one month’s wages, for the purpose of the proviso to Section 33(2)(b) of the Act. The Tribunal dismissed the application for failure to comply with the mandatory requirement of the section, by taking the view that Shift Allowance was part of ‘wages’ as defined in Section 2(rr) of the Act. While disagreeing with the view taken by the Tribunal, the Supreme Court harmonised the two apparently inconsistent streams of legal thought expressed in Bennet Coleman & Co. (P) Ltd. v. Punya Priya Das Gupta and Dilbagh Rai Jarry v. Union of India and Ors. , and summed up the resultant legal principle in the following words (vide paragraph 15):-
“Now confluencing the two legal thoughts expressed in Bennet Coleman’s case (supra) and Dilbagh Rai Jarry’s case (supra), the stream of thought which inevitably gurgles up is that an allowance which from the term of employment flows as not contingent on actual working is part of wages for the purposes of Section 33(2)(b) but an allowance which is earnable only by active serving is not an allowance which will form part of wages, within the meaning of the said provision”.
Applying the test gurgling out of the confluence of the two streams of legal thoughts, the Supreme Court took the view that Shift Allowance was payable only for actively working during night shifts, and, therefore, it did not legitimately form part of ‘wages’ for the purpose of Section 33(2)(b). In the petitioner’s case, however, there is a formidable difficulty. Clause 7(ii) of the Settlement dated 28th September, 1973, which governs the terms of employment, provides as under:
“Free Quarter of House Rent Allowance
7. House Rent Allowance
(i) ……….
(ii) H.R.A. will not be paid when a workman is absent without pay, except in cases when such absence from work is on account of employment injury and such absence is duly certified either by Company’s Medical Officer, E.S.I.C. Panel Doctor or by any E.S.I. C./Municipal/ Government Hospital.
(iii)……..”
Further, D.Y. Chitnis, the witness of the petitioner before the Tribunal, admitted in his evidence, as under:
“H.R.A. is paid according to the settlement. It is paid to those workmen who are working or are on paid leave or who are on accident leave”.
12. Under the terms of employment, the petitioner would have been entitled to H.R.A. even when he was not actively working, such as when he was on authorised leave. This result flows from an interpretation of Clause 7(ii) of the Settlement dated 28th September, 1973, as supported by the candid admission of the petitioner’s witness before the Tribunal. If this be so, applying the test laid down by the Supreme Court in Bharat Electronics’ case, it would follow that H.R.A. was a part of the ‘wages’ of the workman. The workman has not been paid this amount, which was properly and legally includible in his one month’s wages. To this extent, therefore, though nominal, there is a shortfall of Rs. 40/- in the amount of one month’s wages. Consequently, there is breach of the mandatory provisions of Section 33(2)(b) of the Act. The Tribunal’s judgment of this aspect of the matter, therefore, cannot be faulted, and needs to be Upheld, though, for reasons other than what the Tribunal itself has given, viz., by application of the test evolved by the Supreme Court in Bharat Electronics case.
13. Now it is time to examine the last contention raised by Mr. Parakh, viz., that, even if this Court upholds the Tribunal’s view that there was contravention of the mandatory provisions of Section 33 resulting in rejection of the approval application, the legal result would not be an automatic reinstatement and/or allowing claim for back-wages. At the most, such contravention would be a technical breach of the section entitling the workman to move a complaint under Section 33-A of the Act or complain to the appropriate Government for prosecution or the erring employer under Section 31 of the Act. The judgment of the Supreme Court in Punjab Beverages Pvt. Ltd v. Suresh Chand and Anr. 1978 II L.LJ. 1 is cited in support of this contention. Though Mr. Kochar, learned counsel for the second respondent, tried to distinguish this authority, in my view, the judgment in Punjab Beverages’ case does fend support to the petitioner’s contention on this aspect.
14. In Punjab Beverages’ case, the Supreme Court was concerned with the situation where the employer had made an application for approval of the action of dismissing his workman, but had subsequently withdrawn the application. The Supreme Court took the view that the withdrawal of the application for approval stood on the same footing as if no application under Section 33(2)(b) of the Act had been made. This, in the view of the Supreme Court, amounted to a mere technical breach of the section, as the Tribunal had no opportunity to consider, on merits, as to whether the ban imposed on the dismissal by Section 33(2)(b) should be lifted. The Supreme Court held that every breach of Section 33 did not render the dismissal order void or inoperative. The only consequence flowing from such breach would be to entitle the workman to file complaint under Section 33-A of the Act or to move the
State Government for prosecution of the
employer. If, on the other hand, the Tribunal
has an opportunity to apply its mind to
the, merits of the case and rejects the application for approval after coming to a
conclusion that no prima facie case had
been made out, or that there had been unfair
labour practice or victimisation, then the
Tribunal would refuse to grant approval
and reject the application on merits. In
such an eventuality, the dismissal of the
workman would be void and inoperative,
and the result would be that the workman
would be automatically entitled to reinstatement and/or back wages without any further
ado. This position in law has been clearly
laid down by the Supreme Court in Punjab
Beverages case where it observes (vide para
graph 15), as under:-
“……….Where the Tribunal entertains an application for approval under Section 33(2)(b) on merits, it applies its mind and considers whether the dismissal of the workman amounts to victimisation or unfair labour practice and whether & prima facie case has been made out by the employer for the dismissal of the workman. If the Tribunal finds that either no prima facie case has been made out or, mere is victimisation or unfair labour practice, it would refuse to grant approval and reject the application on merits. Then of course the dismissal of the workman would be void and inoperative, but that would be because the Tribunal having held that no prima facie case has been made out by the employer or there is victimisation or unfair labour practice, it has refused to lift the ban. Where, however, the application for approval under Section 33(2)(b) is withdrawn by the employer and there is no decision on it on merits, it is difficult to see how it can be said that the approval has been refused by the Tribunal. The Tribunal having had no occassion to consider the application on merits, there can be no question of the Tribunal refusing approval to the employer. It cannot be said that where the application for approval is withdrawn, there is a decision by the Tribunal to refuse to lift the ban.
”The withdrawal of the application for approval stands on the same footing as if no application under Section 33(2)(b) has been made at all”.
15. In my view, whether the application for approval is withdrawn or is rejected as untenable, the result would be the same. Rejection of an approval application as untenable for failure to comply with the requirements of Section 33 would, in my judgment, amount to a technical breach of the section and produce the legal result as laid down in Punjab Beverages’ case. Such a rejection of the application would not be a ‘refusal’ of approval and would not, therefore, result in the employer’s automatic liability to reinstate and/or pay back-wages.
16. The petitioner’s case is on a somewhat better footing. After application of mind carefully to the merits of the case, the Tribunal has recorded its finding that a prima facie case for approval has been made out. The Tribunal, however, rejected the application purely on account of the technical default in short payment of Rs. 40/- towards H.R.A., which legally ought to have been included in the one month s wages payable under Section 33(2)(b) of the Act. In my judgment, the consequences of the Tribunal’s rejection of the approval application would fall squarely within the ratio of the decision of the Supreme Court in Punjab Beverages’ case. The dismissal order passed against the second respondent is not rendered void, inoperative or non est as a result of the application for approval being rejected by the Tribunal. The second respondent, however, has the legal right to move a complaint under Section 33-A for contravention of the provisions of Section 33(2)(b) of the Act or move the State Government for prosecution of the petitioner, if so advised. To this extent, I uphold the last contention of Mr. Parakh as to the legal consequences ensuing from the rejection of the petitioner’s application for approval of the action of dismissal taken against the second respondent-workman.
17. In the result, the petition is liable to be dismissed. The legal consequences of upholding the Tribunal’s judgment are as ‘indicated in the judgment. The petition is ‘dismissed and the Rule discharged with no order as to costs.
