F W HEILGERS AND CO Vs. NAGESH CHANDRA CHAKRAVARTY

JUDGEMENT

(1.) THIS is an appeal from a judgment of the High Court of Judicature at Fort William in Bengal. The appellant (petitioner) is a firm registered under the Indian Partnership Act and carries on btisiness in Calcutta inter alia as the managing agent of the Titagarh Paper Mills Company, Ltd. , and other companies. At all material times the company had employed about 5,400 workmen and 370 clerks. Early in December, 1946, two trade unions of the company's employees were formed and registered under the Trade Unions Act. On March 14, 1947, there was a strike which continued up to May 23, 1947. The employees claimed from the company bonus for work done by them during the period of war. They further claimed the grant of annual bonus equivalent to one month's pay for the years 1945 and 1946 and lastly they claimed the introduction of a profit-sharing scheme, with effect from January, 1947, which will give them a profit-sharing bonus in each succeeding year. The first claim was made on the footing that there was an agreement to pay such bonus. The second claim was on the footing that the same should be considered as terms of their employment during the years 1945 and 1946. The last claim was on the footing that such a term of employment should be considered to exist for the subsequent years. On February 6, 1948, the Government of West Bengal made an order under the Industrial Disputes Act, 1947, referring the dispute for adjudication to the Industrial Tribunal consisting of Shri Nagesh Chandra Chakravarty. In spite of the protest of the appellant firm, Mr. Chakravarty intimated that he would proceed with the enquiry and the appellant thereupon filed a petition before the High Court for the issue of writs of certiorari and prohibition and for an order, in effect, under Section 45 of the Specific Relief Act.

(2.) BEFORE the High Court various contentions were raised by the parties but they were not all argued before us. It appears that before the High Court it was contended that the payment of a bonus was a gratuity and therefore it could not be subject of an industrial dispute. This point was not pressed before, us. Mr. Chaudhury, who appeared for the appellant, based his whole contention on the wording of the Payment of Wages Act (Act IV of 1936 ). He contended that the claim to payment of all the three kinds of bonus could not be considered because it violated the provisions of Sections 20 and 23 of the Payment of Wages Act, and any attempt to order payment of such bonus would be illegal and therefore could not be within the jurisdiction of the Tribunal appointed under the Industrial Disputes Act. It was conceded that unless the claim to the bonus fell within the definition of Wages Act, the dispute between the parties was an "industrial dispute" within the definition of that expression in the Industrial Disputes Act. It has therefore to be decided whether such claims for bonus fell under the definition of wages under the Payment of Wages Act.

(3.) IN our opinion this line of reasoning omits to consider the scheme of the; Payment of Wages Act and the words used in the definition of "wages" in that Act. The scheme of the Act was clearly to prevent employers from delaying payment of the amount earned by the workmen beyond the period mentioned in the Act. But this assumes that the payment of an ascertained sum had become due and the employer had delayed payment. The definition of "wages" properly read shows that the amount must be an ascertained sum before it falls under the definition. INdeed, it expressly includes the word bonus or other additional remuneration which would be payable under the contract of employment. IN order to bring a particular payment under the definition of "wages," two things are necessary (1) a definite sum, and (2) a contract indicating when the sum becomes payable. The last portion of the definition shows that payments stipulated to be made by reason of the termination of employment are also wages. That will be in the nature of damages. It is obvious that unless there is an express provision for paying a stipulated sum, the definition will not cover such a payment. Any other interpretation of the section will lead to very anomalous results. It will prevent the making of any agreement between an employer and employee under which the employees can share in the profits of the company. If the appellant's contentions were accepted; such an agreement will be illegal. IN our opinion the whole scheme of the Payment of Wages Act, read along with the INdustrial Disputes Act, shows that there is nothing to prevent such an agreement being made between an employer and employee, and much less to make such agreement illegal and prohibited by the Payment of Wages Act. Section 23 of the Payment of Wages Act also in our opinion does not support the argument of the appellant. It only prevents an employee from contracting away his rights which are given by the Payment of Wages Act. It does not prevent him from entering into an agreement advantageous or beneficial to him.