SABYASACHI MUKHERJEE,J. - (1.) Shyamapada Das, the respondent No. 2 is an employee of M/s. Algemene Bank Nederland, N. V. the petitioner herein. The petitioner carries on banking business in India and for this purpose employs various categories of employees, namely, officers, clerical staff and subordinate staff at its establishment at 18A, Brabourne Road, Calcutta. The said establishment is a commercial establishment within the meaning of the West Bengal Shops and Establishments Act, 1963 and as such is registered under the said Act. The banking industry has been declared by the appropriate Government as one engaged in the utility service. The terms and conditions of service, including the hours of work, wage structure of the employees are governed by the various awards, namely, Sastri Award, Desai Award and the Industrywise Bipartite Settlement, dated the 19th October, 1966 and various settlements arrived at subsequent thereto. It will be necessary at the relevant time to refer to the provisions of the Bipartite Agreement in detail. On the 10th September, 1975 the members of the staff, clerical and subordinate, excepting lady staff by ceasing work in combination left their respective places of work at 3 p.m. and according to the petitioner -Bank, illegally and wrongfully held a meeting and demonstration inside the Bank premises during the Bank's normal working hours by forming, again according to the petitioner -Bank, an unlawful assembly. The members of the said assembly including the respondent No. 2 Shyamapada Das remained absent from their works, shouted slogans and squatted inside the premises without doing any work from 3 p.m. to 5 -45 p.m. The petitioner -Bank without prejudice to its right to take desciplinary action issued a notice. The said notice after setting out the aforesaid facts contained the following statement : Without prejudice to the right of the bank to take disciplinary action where warranted, the concerned members of the staff are hereby informed that they would not be entitled to any salary for their period of absence from their duty on the basis of 'No work No pay.' This will, however, not apply in cases of those who were on sanctioned leave on that day. The petitioner -Bank paid wages to the workmen including the respondent No. 2, who had remained absent. on the 10th September, 1975 on a pro rata basis for the period they had rendered services and did not pay any wages for the period of absence. Thereupon, on the 17th May, 1976, the respondent No. 2 filed an application under Section 33C(2) of the Industrial Disputes Act, 1947 for recovery of a sum of Rs. 11.41 before the Central Govt. Labour Court at Calcutta. The respondent No. 2 alleged that the petitioner -Bank had wrongfully deduted Rs. 11.41 from the salary of the respondent No. 2 for the month of September, 1976. It was further alleged by the respondent No. 2 that neither in the bipartite settlement nor in any law of the land applicable to the parties, was there any provision for deducting monthly salary of any workman pro rata on the basis of the alleged, 'No work No pay'. The petitioner -Bank filed an objection to the said application and contended that the applicaiton under Section 33C(2) was misconceived and not maintainable. The petitioner contended that the workman concerned had no right under the law to claim wages for the period for which he did not work. It was further contended that the claim of the respondent No, 2 was not based on any claim for money or benefit derived under any Award or Settlement but on the ground that although the workmen of the Bank had remained absent from the duty, yet they were entitled to salary for the period of their absence. The petitioner contended that there was no right or entitlement of the respondent No. 2 for the money claimed. It was, therefore, submitted that the application under Section 33C(2) of the Industrial Disputes Act, 1947 was misconceived. The application came up for hearing before the Central Government Labour Court at Calcutta and by an order dated the 28th February, 1977 the Central Government Labour Court has allowed the application of the respondent No. 2 and has directed the Bank to pay Rs. 11.41. In the said order after setting out the rival contentions and the notice dated the 11th September, 1975 referred to hereinbefore, the Central Government Labour Court has proceeded, inter alia, to hold as follows : 5. Para 19.7 of the Bipartite Settlement dated 19 -10 -1966 deals with the 'minor misconduct' which includes (a) absence without leave, (c) neglect of work, negligence in preforming duties, (d) breach of any rule of business of the Bank or instruction for the running of any department, (e) committing nuisance on the premises of the Bank, etc. The management could have proceeded against the concerned workman under any or all of the grounds enumerated above for the incident which took place on 10 -9 -1975 within the premises of the Bank. Without doing so they proceeded against the workman by deducting proportionate salary out of his monthly emoluments. The Bank cannot shut its eyes against the misconduct. It did not proceed against the workman by taking disciplinary action. Deducting a portion of the workman's salary without giving him an opportunity to explain his conduct and without taking desciplinary proceedings will amount to a punishment. No punishment can be imposed on a workman except in due process of law. So, the deduction of salary made in this case cannot be supported. 6. A workman is entitled to file an application under Section 33C(1) or (2) of the Act if he is to recover any amount legally due to him. There is nothing for the workman to establish before this Court except the fact that he was deprived of Rs. 11.41 p. out of his salary for the month of September, 1975. Normally he would be entitled to the amount claimed. He could not be deprived of that amount unless it was withheld in due process of law. The management did not follow any rule of law applicable to the parties before the amount of the salary was withheld. Withholding the salary is invalid and inoperative. The workman is entitled to get back the amount of Rs. 11.41 p. out of his salary for the month of September, 1975, from the Bank. In this application under Article 226 of the Constitution, the petitioner -Bank has challenged the said finding and the decision of the Labour Court.
(2.) TWO main contentions were urged in support of this application. It was contended, firstly, that, the Labour Court was in error in proceeding with the application in the instant case and the Labour Court had no jurisdiction in the facts and in the circumstances of this case, to make any order under Section 33C(2) of the Industrial Disputes Act, 1947. It was urged that the respondent No. 2 had no right or entitlement under the law to claim the said amount. The Labour Court, it was urged, was not competent to adjudicate the right and thereupon grant relief to the parties upon such adjudication of right. It was, secondly contended that in any event the Labour Court was in error in holding that the respondent No. 2 was entitled to wages for the hours he did not work and that the petitioner -Bank was not entitled to deduct the wages for the period of hours when this workman did not render any services. Various authorities, which I shall presently notice, were cited in aid of this submission. The respondent No. 2 submitted before me that the instant writ application of the petitioner was not maintainable. He urged that the service contract between the Bank and the employee was an indivisible contract and could not be made the subject -matter of appropriation. There was no right under the contract to deduct any wages for any period of days or of hours. He, further, submitted that there could not be any deduction of wages without due process of law. He urged that principles of natural justice had been violated and the principles of natural justice were attracted in the facts and circumstances of this case because the deduction of wages in the manner done was in the nature of punishment which could not have been inflicted without following the procedure in accordance with the natural justice. He also relied on several authorities which I shall presently notice. - - It is necessary to consider, first, the question whether in this case the respondent No. 2 was entitled to salary for the hours he did not work. In this connection, as mentioned hereinbefore, it is the common case that the Calcutta Branch of the petitioner -Bank was a commercial establishment coming within the purview of the West Bengal Shops and Establishments Act, 1963. Section 2(15) of the said Act defines wages. It provides that 'wages' means wages as defined in the Payment of Wages Act, 1936. It is, therefore, necessary to refer to the definition of ' wages' under Section 2(vi) of the Payment of Wages Act, 1936. The said provision reads as follows : '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 the State 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). While on the West Bengal Shops and Establishments Act, 1963 it may also be appropriate to refer to Section 7 of the said Act which lays down the hours of work in establishments. Section 14 deals with the payment and recovery of wages and it provides that all wages payable to a person employed in a shop or an establishment shall be paid not later than the 10th day of the month immediately succeeding in respect of which such wages are payable. Sub -section (2) of Section 14 provides that where any deduction has been made from the wages of any person employed in a shop or an establishment or any payment of wages to such person has not been made within the date referred to in Sub -section (1), such person may, within a period of six months from the date of which the deduction from the wages was made or from the date referred to in Sub -section (1), as the case may be, make an application to such an officer or authority as the State Government may, by a Notification, appoint for an order under Sub -section (3). Sub -section (3) of Section 14 is to the following effect : (3). The officer or authority to whom or to which an application under Sub -section (2) is made may, after giving the applicant and the shopkeeper or employer concerned an opportunity of being heard and after making such further inquiry, if any, as may be necessary, by order, direct, without prejudice to any other action which may, under this Act or any other law, lie against the shopkeeper or employer, the payment to the applicant of the amount deducted from the wages or of the wages due, together with such compensation, not exceeding ten times the amount deducted in the former case and not exceeding ten rupees in the latter, as the officer or authority may think fit: Provided that no direction for the payment of compensation shall be made in the case of delay in the payment of wages if the officer or authority is satisfied that the delay was due to - (a) a bona fide error or bona fide dispute as to the amount payable to the applicant, or (b) The occurrence of an emergency, or the existence of exceptional circumstances, such that the shopkeeper or the employer, as the case may be, was unable, though exercising reasonable diligence, to make prompt payment, or (c) the failure of the applicant to apply for or accept payment. In aid of the submission that wages is only payable for the work done, learned Counsel appearing for the petitioner -Bank first drew my attention to the decision of the Division Bench of the Bombay High Court in the case of Arvind Mills Ltd. v. K.R. Gadgil A.I.R. 1941 Bom. 26. There Chief Justice Beaumont dealing with the definition of ''wages' in Section 2(vi) and Section 7 of the Payment of Wages Act, 1936, held that the expression 'wages' means wages earned and not potential wages. His Lordhip further observed that the expression, 'remuneration, which would, if the terms of the contract were fulfilled, be payable', in Section 2(vi) meant no more than, ' remuneration payable on the fulfilment of the contract.' His Lordship further was of the opinion that prima fade an employer was not bound to pay for work which had not been done and an employee was not entitled to receive payment which he had not earned. Reliance was also placed on the observations in the Halsbury's Laws of England, 4th Edition, Volume 16, Article 554 under the heading 'performance of duty as condition precedent to remuneration'. There it has been noted that when the contract of employment is an entire contract, providing for payment on the completion of a definite period of service or of a definite piece of work, it was a condition precedent to the recovery of any remuneration in respect of it that the services or duty should be completely performed, unless the employer so altered the contract as to entitle the employee to regard it as at an end, in which case the whole sum payable under the contract became due : or there was a usage that the employee was entitled to remuneration in proportion to the time actually served or it could be inferred from the circumstances that there had been a fresh agreement between the parties that payment should be made for services actually rendered under the original contract, or the contract had been frustrated. Under Article 610, Halsbury has noted that if there were normal working hours and the employee's remuneration for employment in those hours whether by the hour or week or other period, did not vary with the amount of the work done in the period, the employer is liable to pay the employee for the normal working hours as much as the amount which would have been payable if the employee had been employed throughout the part of the normal working hours during which he was ready and willing to work but no work was provided for him by his employer or he was incapable of work because of sickness or injury or if he was absent from working in accordance with the terms of his employment relating to holidays. If there are normal working hours, but the employee's remuneration or employment in those hours varies with the amount of work done in the period, the employer is liable to pay for the part of the normal working hours covered by the three divisions stated hereinbefore. In the case of Venkatavardan v. Semiliam Saw Mills : (1955)IILLJ11Mad , learned single Judge of the Madras High Court held that the jurisdiction of the authority under the Payment of Wages Act was limited to all claims arising out of deduction of wages and delay in payment of wages only. It was clear that wages was dependent upon the terms of the contract and not otherwise and if the terms of the contract did not show that the employee was entitled to continue his service irrespective of his not attending the work then the amount claimed for the period during which he did not work could not be considered to be wages within the definition of the term under the Act. In the case of Divisional Engineer, G.T.P. Rlys. v. Mahadeo Raghoo : (1955)ILLJ359SC , the Supreme Court after referring to the definition of the wages in Section 2(vi) of the Payment of Wages Act observed that shorn of all verbiage, 'wages' are remuneration payable by an employer to his employee for services rendered according to the terms of the contract between them.
(3.) THE question then arises in each case, therefore, what are the terms of the contract between the parties. In the case of Gaumont -British Picture Corporation Ltd., v. Alexander [1936] 2 All ER 1886, it was held that the Court did not enquire into the adequacy of the consideration of a contract and where a party left the determination of all matters under a contract in the discretion of the other party that did not in all circumstances constitute the total lack of consideration. A clause in an artist's agreement suspending salary upon her failure to appear and perform did not prevent the employer's recovering damages for breach of contract as well as suspending her salary. The suspension of salary, it was held, was not penalty. In Halsbury's Laws of England, 3rd Edition, Vol. 25 under Article 897 it has been observed, a servant is under the obligation not to absent himself from work without good cause during the time at which he is required to be at work by the terms of his contract of service. If he absents himself without good cause, his master is entitled to recover damages against him for breach of contract and the absence of the servant may, if it amounts to misconduct inconsistent with the due and faithful discharge by the servant of his duties, constituted a good cause for his dismissal. Under Article 915 it had been observed that when the contract of a service was an entire contract providing for payment on the completion of a definite piece of work, it was a condition precedent to the recovery of any salary or wages in respect thereof that the service or duty should be completely performed, unless employer so altered the contract as to entitle the servant to regard it at an end in which case the whole sum payable under the contract becomes due.;