Hindustan Lever Ltd. Vs. Ram Mohan Ray
& Ors  INSC 41 (7 March 1973)
CITATION: 1973 AIR 1156 1973 SCR (3) 924 1973
SCC (4) 141
CITATOR INFO :
D 1975 SC1856 (9) R 1984 SC 516 (7,20)
Industrial Disputes Act (14 of 1947) ss. 9A,
33A and 33C and 4th Schedule items 8, 10 and 11-Scope of Industrial Dispute-
Reference to Tribunal Applications by Workers pending reference-Disposed of by
different Tribunal-Contradictory findings-Procedure not illegal.
Constitution of India, 1950, Article
Before September 1966 the marketing
Organisation of the employercompany was in three divisions. Thereafter it was
organised into two divisions. There were extensive and prolonged consultations
between the employer and the employees but the reorganisation was not approved
by the employees. The new scheme was introduced on the 5th or 6th September and
the industrial dispute arising therefrom was referred to the Tribunal on 30th
September. The workers presented themselves for work every day and offered to
work according to the old scheme but they were not given any work. They were
told that as long as they refused to work under the new scheme they would not
be paid any wages. Some workers had voluntarily retired and the vacancies were
not filled. Therefore, pending the adjudication on the reference already made,
seven workers filed applications under s. 33A of the Industrial Disputes Act,
1947, alleging that during the pendency of the adjucation, their service
conditions had been changed adversely and that their salary for the month of
October had not been paid. The Industrial Tribunal was different in the two
cases as also the evidence let in the two cases. In the main reference, the
Tribunal held in favour of the employer. With reference to the applications of
the employees, the other Tribunal held in favour of the employees on the
grounds that the conditions of work had been changed to the workers' prejudice,
that the reorganisation was likely to lead to re- trenchment, that the matter
thus fell under item 10 of Schedule 4 to the Act and that therefore, the
employees were justified in refusing to work. Both parties appealed to this
HELD : On a consideration of the material in
each of the awards 'both the awards should be upheld. [628 A-B] (1) The
evidence given in the main reference not being a part of the evidence in the
applications filed by the employees it is not open to this Court to take it
into consideration in deciding the appeals filed by the employer as against the
award in favour of the employees. [628A] (2) This Court, in considering a
matter under Art. 136, does not ordinarily reassess the evidence on the basis
of which the Tribunalcame to its conclusion. It will interfere with findings of
facts only if they are unsupported by any evidence or are wholly perverse. [628
D-E] (3) The reorganisation is neither a change in usage falling under item 8
of the 4th Schedule to the Act, nor rationalisation falling under item 10, nor
an increase or reduction in the number of persons employed in any department
falling under item 11; and hence, it was not necessary to give any notice under
s. 9A of the Act. [633 D-E] 625 (a) The employer has a right to organise his
work in the manner he pleases. [631C] (b) The various decisions show that
whether any particular practice or allowance or concession had become a
condition of service would always depend upon the facts and circumstances of
each case., On the evidence and findings given by the Tribunal it cannot be
held that there has been any change in the terms and conditions of service of
the workers in this case to their detriment. [633 C-E] Parry & Company's
, 1 L.L.J. 429; Dharangadhara Chemical ,Works Ltd., v. Kanju Kalu &
Ors.  1 L.L.J.
316; Chandramalai Estate v. Its Workmen
 2 L.L.J. 243;
The Graham Trading Co. (India) Ltd. v. Its
Workmen  1 S.C.R. 107; Workmen of Hindustan Shipyard Ltd. v. I.T.
 2 L.L.J. 526; McLeod & Co. v. Its
Workmen  1 L.L.J. 396; Indian Overseas Bank v. Their Workmen [1967- 68]
33 F.J.R. 457; Indian Oxygen Limited v. Udaynath Singh  2 L.L.J. 413, Oil
& Natural Gas Commission v. Their Workmen  42 F.J.R. 551 and Tata
Iron & Steel Co. v.
Workmen A.I.R.  S.C. 1917, referred to.
(c) The Tribunal held on the basis of oral as
well as documentary evidence that the contention of the workers that it was a
condition of service of every employee to work for only one division at a time
was not established. The arrangement of the words and phrases in item 10 shows
that only rationalisation or standardisation or improvement of plant or
technique, which is likely to lead to retrenchment of workmen that would fall
under that item and not mere rationalisation or standardisation. The
retrenchment contemplated is retrenchment as defined in s. 2(00), which does
not include voluntary retirement of the workmen.
Therefore, the workers cannot make a
grievance of the voluntary retirement and non-filling of vacancies and try to
bring the matter under item 10. The employer had the right to decide the staff
complement and to fill only such jobs as continued to exist and not
automatically replace every individual. [630 A-H] Alembic Chemical Works Co.
Ltd. v. The Workmen,  3 S.C.R. 297, referred to..
Therefore, there is no reason for differing
from the findings of the. Tribunal that there has been no change in usage
adversely affecting the workers coming under item 8, and that there has been no
retrenchment under item 10.
[632D] (4) The 4th schedule relates to
conditions of service for change of which the notice is to be given, and s.
9(A) requires the employer to give notice under that section to the workmen
likely to be affected by such. change. The word 'affected' in the circumstances
could only refer to the workers being adversely affected and unless it could be
shown that the abolition of one department has adversely affected the workers
it cannot be brought under item 11.
[631 A-C] [The question whether the prolonged
and detailed discussion between the parties was a substantial compliance with
the provisions of s. 9A not decided].[633E] (5) But the non-payment of wages in
the circumstances of this case amounts to an alteration in the conditions of
service and the fact that the scheme was introduced before the reference under
s. 10 was made does not bar an application under s. 33A. The tribunal was
justified in coming to the conclusion that this alteration in the conditions of
service could not have been made without the notice under s. 9A. [634 C-D; 635
B-C] 626 (a) The applications in this case were not for wages due for the month
of September but for October. [634E] (b) The refusal to pay wages was not a
solitary instance in respect of which an application could have been made under
s. 33C. it was a continued refusal and the cause of action arises de die in
diem. If the refusal of the workers to work under reorganisation scheme is
justified then the refusal by management to pay unless they work under the
reorganisation scheme would amount to alteration of the conditions of service
of Workers. [634 G-H] (c) Even if an application had been made under s. 33C the
whole scheme would have been considered and it is not fair at this distance of
time to drive the workers to file application under that section, the procedure
for which would be the same as under s. 33A, merely on the ground that the
introduction of the scheme had taken place before the reference to the
adjudication was made. [636 B-C] (d) The Tribunal had found that the
reorganisation scheme had rendered some workers surplus, that the scheme had
seriously prejudiced. the workers, and that the apprehension of the workers
that the reorganisation would result in some members of the staff becoming
surplus had come true. [635 A- B] North Brooke Jute Co. Ltd.  3 S.C.R.
364, National Coal Co. v. L. P. Dave,  A.I.R. Patna 294, Shama Biscuit
Co. v. Their Workmen  2 L.L.J. 353, referred to :
Ram Nath Koeri v. Lakshmi Devi Sugar Mills
& Ors.  2 L.L.J., 11, approved.
(e) If all the evidence which was let in in
the main reference were available to the Tribunal which decided the
applications of the workers, the result might have been different. But it could
not be said that the Tribunal is wrong in having proceeded to dispose of the
matter in the way it did. [636 A-D]
CIVIL APPELLATE JURISDICTION: Civil Appeals
Nos. 675 to 681 of 1967.
Appeals by special leave from the Award dated
March 23 1967 of the Third Industrial Tribunal, West Bengal in Misc.
Cases Nos. 161, 160, 162-64 and 167 of 1966.
AND Civil Appeal No. 1759 of 1971 Appeal by
special leave from the Award dated August 11, 1969 of the Third Industrial
Tribunal, West Bengal, Calcutta in Case No. VIII:-373 of 1966 published in the
Calcutta Gazette dated 27-9-1969.
S. V. Gupte, G. B. Pai, Bhuvanesh Kumari, B.
Ram Rakhjani and J. B. Dadachanji & Co. for the appellant. (In C.As. 675-
V. M. Tarkunde, Rathin Das, Jitendra Sharma
and S. K. Ganguli & Co. for the appellant. (In C.A. 1759/71).
627 V. M. Tarkunde, Jitendra Sharma and
Janardan Sharma, for the Respondent.
The Judgment of the Court was delivered by
ALAGIRISWAMI, J.-The first batch of appeals are by the Hindustan Lever Ltd.
(hereinafter called the Employer) and Civil Appeal No. 1759 of 1971 is by the
Mazdoor Sabha of the workers of the same employer in its Calcutta Branch.
The Calcutta Branch was concerned only with
marketing. From the year 1956 at least, if not earlier, the company's marketing
Organisation was in three divisions, the Soaps Division, the Foods Division and
the Toilet Preparations Division. From 6-9-66 the Company reorganised this
marketing Organisation into two divisions- the Main Lines Division and the
Speciality Lines Division. On 30-9-66 the Government of West Bengal referred to
the Third Industrial Tribunal the following question for adjudication :
"Is the human rationalisation as a
measure of economic reorganisation of the Company reflected through
job-integration that have either been effected or proposed to be effected
justified,? To what relief, if any, are the workmen entitled?" Pending
adjudication of this issue seven workers filed applications under section 33A
of the Industrial Disputes Act before the same. Tribunal alleging that during
the pendency of the adjudication their service conditions had been changed
adversely and their salary for the month of October 1966 had not been paid. The
Tribunal held in favour of the workers and passed its award on 23-3-1967. By
special leave granted by this Court the employer has filed the above 7 appeals.
The main reference was finally disposed of on 11-8-69 by the same Tribunal
holding in favour of the employer and the workers have, therefore, filed Civil
Appeal No. 1759 of 1971 by special leave granted by this Court.
It should be mentioned that the Presiding
Officer of the Industrial Tribunal was different in the two cases but the
different conclusions arrived at by the two Presiding Officers were not due to
the accident of difference in personnel. There was a vast mass of evidence let
in by the employer in the main reference on a consideration of which the
Tribunal held in favour of the employer. On the other hand the evidence in the
applications, filed under section 33A of the Industrial Disputes Act, let in by
the employer was meagre and the Tribunal came to the conclusion on the material
available before it that the conditions of work of workers had been changed to
their prejudice, that the reorganisation was likely to lead to retrenchment and
that the matter thus fell under Item 10 of Schedule IV of the Industrial
Disputes Act. The evidence given in the main reference not being part of the
evidence in these 7 cases it is not open to this Court to take it into
consideration in deciding these 7 appeals. On an exhaustive consideration of
the material in both the awards we have come to the conclusion that both the
awards should be upheld.
Though the decision in the appeals by the
management is based on the finding of the Tribunal that the conditions of work
had been changed to the disadvantage of the workers, and the decision in the
appeal filed by the workers is in effect that the conditions have not been so
changed, that is due to the evidence available in the two cases. Mr. Tarkunde
appearing on behalf of the workers in the appeal filed by them in C.A. No. 1759
of 1971 in effect invited us to re-assess the evidence in that case. His whole
point was that the reorganisation effected by the management in September 1966
was one which attracted items 8, 10 and 11 of the IVth Schedule to the Industrial
Disputes Act and as such a notice in accordance with Rule 34 of the West Bengal
Industrial Disputes Rules and Form (E) appended to those rules, under section
9A of that Act was necessary. He was at pains to establish this proposition
lest it should effect the workers in the others 7 appeals filed by the
This Court in considering a matter under
Article 136 does not ordinarily re-assess the evidence on the basis of which
the Tribunal came to its conclusions. It will interfere with the findings of
facts by the Tribunal only if it is unsupported by any evidence or is wholly
perverse. It will not interfere with findings of the facts if two views are
possible as to the conclusions to be arrived at on the basis of the evidence
even though the conclusions arrived at by the Tribunal might not commend itself
to this Court. Mr. Tarkunde even indicated that he was not very much interested
in the success of the appeal of the workers in the sense that he wanted the
scheme of reorganisation introduced by the employer to be dropped. According to
him the employer had the right to reorganise his business subject only to his
compliance with the provisions of section 9A of the Industrial Disputes Act,
which according to him has not been done in this case. He wanted to establish
this proposition only for laying a foundation for the argument that when after
the introduction of the reorganisation by the employer the workers refused to
work except on the basis of the previous system of working, they were perfectly
within their rights and it was, therefore, illegal for the management to have
refused to pay them their salary and that this was an alteration of the
conditions of their service during the pendency of an adjudication of an
industrial dispute before the Industrial Tribunal. But in the view we are
taking regarding the correctness of the award of the Industrial Tribunal on the
applications of the workers under section 33A the workers would probably have
629 We shall first of all deal with the
appeal by the workers.
Two points were raised by Mr. Tarkunde :
1. That it was necessary to give notice under
section 9A and wait for 21 days before implementing the scheme of
2. as notice was necessary, the scheme cannot
be said to be justified when it was implemented.
As regards nonpayment of wages, as subsidiary
points, he raised the questions 1.the workmen were _justified in refusing to
work under the new scheme, and
2. the non-payment of wages amounted in the
circumstances of the case to an alteration in the conditions of service to the
prejudice of workers.
These two are really questions which arise in
the appeals filed by the employer and not in this appeal. According to Mr.
Tarkunde the very fact that three Divisions were sought to be reduced to two
would show that it would increase the workload on the workmen and result in
retrenchment. We do, not think that the matter could be disposed of on such a
priority consideration. His grievance also was that the employer had agreed to
consult the workers but did not do so. He also urged that three godowns which
previously existed were reduced to. two godowns and that proved a greater
burden on the Godown Keeper. He further urged that the Journey Cycles, i.e. the
period during which salesmen were expected to be on tour contacting the various
dealers were increased from 4 weeks to 6 1/2 weeks and that this also proved a
greater burden on the salesmen. He urged that the Sabha had a reasonable
apprehension that there will be retrenchment if the 612 week cycles were
introduced. But he conceded that this was avoided in actual working. As already
mentioned earlier, he contended that the Sabha has now no objection to the
present arrangement but the employer contends that conditions are very unstable
and they now have 3 and even 4 divisions. According to him the reorganisation
is either a change in usage falling under item 8 of 10th Schedule to the Act or
rationalisation falling under item 10 or increase or education in the number of
persons employed in any department not occasioned by circumstances over which
the employer has no control falling under item 11.
According to him the workers having been
accustomed to working under 3 divisions, reorganisation into 2 divisions
amounted to a change in usage.
He also urged that rationalisation and
standardisation per se would fall under item 10 even if they were not likely to
lead to retrenchment of workmen and only improvement of plant or technique
would require that they should lead to retrenchment of 8--L761Sup.C.I./73 630
workmen in order to fall. under item IO. A further submission of his was that
standardisation merely meant standardisation of wages. We are not able to
accept this argument. It appears. to us that the arrangement of words and
phrases in that item shows that only rationalisation or standardisation or
improvement of plant or technique, which is likely to lead to retrenchment of
workmen would fall under that item. In other words, rationalisation or
standardisation by itself would not fall under item 10 unless it is likely to lead
to retrenchment of workmen. The reference to rationalisation at page 257 of the
report of the Labour Cornmission and the reference to standardisation of wages
in it are not. very helpful in this connection.
Standardisation can be of anything, not necessarily
of wages. It may be standardisation of workload, standardisation of product,
standardisation of working hours or standardisation of leave privileges. Indeed
in one deci- sion in Alembic Chemical Works Co. Ltd. v. The Workmen(1) there is
reference to standardisation of conditions of service, standardisation of hours
of work, wage structure.
That case itself was concerned with
standardisation of leave. The whole question whether this reorganisation falls
under item 10 depends upon whether it was likely' to lead to retrenchment of
workmen. On this question, as already indicated, the two Tribunals have arrived
at two different conclusions. But as already indicated, it depended upon the
evidence in each case. It is not disputed that the re- organisation has not
resulted in any retrenchment.
Moreover, during the course of rather
prolonged negotiations between the parties the employer made it abundantly
clear again and again that nobody would be retrenched. It was clearly made part
and parcel of the scheme of reorganisation. Hindustan Lever Ltd. being a large
organisation covering the whole of the country there was no difficulty about
giving effect to this reorganisation scheme without retrenching anybody. It
was, however, urged on behalf of the workers that there have been a number of'
voluntarily induced retirements and ;that many posts were not filled after the
holders of these posts had retired or left. We are of opinion that the
retrenchment contemplated under item 10 is retrenchment as defined in clause (oo)
of section 2 where it is defined as the termination by the employer of the
service of a workman for any reason what- soever, otherwise than as a
punishment inflicted by way of disciplinary action, but does not include
voluntary retirement of the workman. The workers cannot, therefore.
make a grievance of the voluntary retirement
and non-filling of vacancies and try to bring it under item 10.
As regards item 1 1 it was urged that as one
department out of three has been abolished, this item applies. Though to bring
the matter under this item the workmen are not required to show (1)  3
631 that there is increase in the workload,
it must be remembered that the 4th Schedule relates to conditions of service
for change of which notice is to be given and section 9A requires the employer
to give notice under that section 'to the workmen likely to be affected by such
change. The word 'affected' in the circumstances could only refer to the
workers being adversely effected and unless it could be shown that the
abolition of one department has adversely affected the workers it cannot be
brought under item 11. The same consideration applies to the question of change
in usage under item 8. Let us, therefore, see what was the scheme of
reorganisation to which the workers took exception.
There can be no dispute that the employer has
got the right to organise his work in the manner he pleases as was held in
Parry & Company's(1) case. As we have pointed out earlier there was
extensive and prolonged consultation between the parties. The real grievance of
the workers seems to be that the reorganisation of the working did not have
their approval. Before the Tribunal the objection of the Sabha to the Company's
scheme of reorganisation was that it was a condition of service. of every
employee to work for only one division at a time after amalgamation of the
three companies and for only one company prior to amalgamation. But the
conditions in the letters of appointment of every worker in the company show
the contrary. The Tribunal also found that the Salesmen of the company did in
fact handle products of more than one division at, a time in the course of
joint selling operation since 1960. It was admitted that they also did it in
the course of integrated selling in Assam since 1964 but that is said to be
because that was done on an experimental basis. It was admitted that there are
many employees in different departments of the company who by virtue of their
_jobs cannot be attached to any one division. The Tribunal, therefore, held on
the basis of oral as well as documentary evidence that the contention of the
workers that it was a condition of service of every employee to work for only
one division at a time was not established. It is in evidence that the company
on occasions transferred products from one group to the other group to meet the
business exigencies of the company. After referring to such instances the
Tribunal has held that in certain cases a system of joint selling of products
of the three divisions by the same salesmen through 'Sales Vans in several
markets in India was adopted. According to the employer if the three divisional
set up had 'been continued, it would have adversely affected the business of
the company and kept a large number of salesmen of the Foods Division only
partly occupied and the company could have had no option but to retrench some
number of salesmen work- (1)  I.L.L.J. 429.
632 ing in the Foods Division. It, therefore,
effected the reorganisation to meet the challenge of change in marketing
The scheme of reorganisation in this case was:
Firstly, as a result of the regrouping of the products from the three divisions
into two lines, the sales management staff of the company was redeployed on a
geographical basis instead of product group basis. Secondly, the employer
reorganised its trade outlets so that ReDistribution Stockists would handle all
the products of the company rather than the products of any particular
division. Thirdly, the entire sales force was redeployed over two products
groups, i.e. Main Lines and Speciality Lines. The Tribunal following the
decision of this Court in Parry & Co. case held that the employer has the
right to decide the staff complement and to fill only such jobs as continued to
exist and not automatically replace every individual. The Tribunal has gone
elaborately into the question of workload and come to the conclusion that there
is no increase in the workload. We have already referred to the question of
journey cycles. We see no reason to differ from the finding of the Tribunal
that there has been no change in usage adversely effecting the worker, and that
as there has been no retrenchment item 10 of Schedule IV is not attracted nor
is item 11.
It is hardly necessary to refer to the various
decisions which were cited before us as to what would constitute conditions of
service the change of which would require notice under section 9A of the Act..
In Dharangadhara Chemical Works Ltd. v. Kantu Kalu & Ors.(1) the Labour
Appellate Tribunal of India held that the increase in the weight of bags to be
carried from cwt to 11/2 cwt was a change in the workload and the company was
bound ,to pay wages as the workmen were willing to work but did not work on
account of the unreasonable attitude adopted by the management. In Chandramalai
Estate v. Its Workmen(2) the payment of Cumbly allowance was held to have
become a condi- tion of service. In The Graham Trading Co. (India) Ltd. v. Its
Workmen(3) it was held that the workmen were not entitled to Puja bonus as an
implied term of employment. In Workmen of Hindustan Shipyard Ltd. v. I.T.(4) in
the matter of withdrawal of concession of coming late by half an hour (than the
usual hour), it was held that the finding of the Industrial Tribunal that
section 9A did not apply to the case did not call for interference. But the
decision proceeded on the basis that the Court will not interfere in its
jurisdiction unless there was any manifest injustice.
In McLeod & Co. v. Its Workmen (5) the
provision for Tiffin was held to be an amenity to which the employees were
entitled, and (1)  I L.L.J. 316.
(2)  2 L.L.J. 243.
(3)  I S.C.R. 107.
(4)  2 L.L.J. 526.
(5)  1 L.L.J. 386.
633 the provision of cash allowance in lieu
of free tiffin directed to be made by the industrial tribunal could not be
considered to be erroneous in law. In India Overseas Bank v. Their Workmen(1)
"key allowance " was treated as a term and condition of service. In
Indian Oxygen Limited v.
Udaynath Singh(2) withdrawal by the
management of the supply of one empty drum at a time at reasonable intervals
was held not to contravene section 9A and 33. In Oil & Natural Gas
Commission v. Their Workmen(3) where there was nothing to show that it was a
condition of service that a workman should work for 61 hours only, no notice of
change was held to be required under section 9A for fixing the hours of work at
eight. In Tata Iron & Steel Co. v. Workmen (4) change in weekly days of
rest from Sunday to some other day was held to require notice. A close scrutiny
of the various decisions would show that whether any particular practice or
allowance or concession had become a condition of service would always depend
upon the facts and circumstances of each case and no rule applicable to all cases
could be culled out from these decisions. In the face of the elaborate
consideration of the evidence and findings made by the Tribunal we are unable
to hold that there has been any change in the terms and conditions of service
of the workers in this case to their detriment. It follows, therefore, that
section 9A is not attracted. It is, therefore, unnecessary to consider the
question whether the argument advanced by Shri Gupte on behalf of the employer
that in view of the very prolonged and detailed discussions that went on
between the parties there was a substantial compliance with provisions of
section 9A and the mere fact that a formal notice was not given under section
9A would not make the reorganisation scheme not valid.
In the applications filed by the workers the
Tribunal was conscious of the employer's right to reorganise his business in
any fashion he likes for purposes of economy or convenience and that nobody is
entitled to tell him how he should conduct his business. But it was of the
opinion that this right of the employer is subject to the limitations contained
in section 9A. It specifically considered the applicability of item 10 of the
Fourth Schedule to the Act and relying upon the decision in North Brooke Jute
(1) held that no scheme of rationalisation
could be given effect to if it was not preceded by a notice under section 9A.
It did not consider it necessary to give a final decision regarding 'the
legality or otherwise of the scheme introduced by the company. But it considered
whether the workers" refusal to work under *,he new scheme was justified.
On the evidence it held that the Union had the apprehension that the proposed
reorganisation would (1) (1967-68) (33) F.J.R. 457. (2)  2 L.L.J. 413.
(3) (1972) 42 F.J.R. 551. (4) A.I.R. 1972
(5)  3 S.C.R. 364, 634 result in some
members of the staff becoming surplus, and that this apprehension was not
without justification, and that the apprehension became true when the
reorganisation was actually introduced. It also held that the workload of the
various applicants increased as a result of the reorganisation. It, therefore,
held that workers were within their legitimate right to refuse to do the work
under the new scheme as no notice has been given under item 9A..
It held that however laudable the object of
the reorganisation may be, it cannot be doubted for a moment on the evidence on
record, that the scheme has seriously prejudiced the workers. It, therefore,
directed the employer to pay all the workers their wages for October 1966.
Mr. Gupte appearing for the employer
contended relying on the decision in the case of North Brook Jute Co. Ltd. v.Their
Workmen (supra) that the alteration of the conditions of service in this case,
even if it should be held that non- payment of wages amounted to alteration of
conditions of service, was made not when a reference tinder section 10 was
pending but that the reference itself having been made after the reoganisation,
no application could be made under section 33A. Technically no doubt this
contention is correct because the scheme was introduced on the 5th or 6th of
September and the reference was made on 30th of September. But the applications
in this case were not for the wages due for the month of September but for October.
The applications proceeded on the basis that
the non- payment of wages was an alteration in the conditions of service, and
it is to that question that we must first address ourselves. Mr. Gupte
contended that non-payment of wages is not an alteration of conditions of
service and that no application under section 33A could be made in such cases
as the remedy available was under section 33C. We are not able to appreciate
this argument. Indeed payment of wages, is one of the most important among the
workers' conditions of service. The worker works essentially only for the wages
to be paid to him. Therefore, the question that would really have to be
answered is whether the refusal of the worker to work was justified or not. It
is in evidence that the workers, presented themselves for work every day and
offered to work according to the old scheme but that they were not given any
work according to the old scheme They were told that as long as they refused to
work under the new scheme they would be paid no wages. The refusal to pay,
therefore, was not a solitary instance in respect of which an application could
have been made under section 33C. It was a continued refusal. It was,
therefore, a permanent alteration of the conditions of service. The cause of
action, so to say, arises de die in diem. If the refusal of the workers to work
under the reoganisation scheme is justified then the refusal of the management
to pay unless they worked under the reorganisation scheme would amount 635 to
alteration of the conditions of service of workers. If on 'the other hand the
workers were not justified in doing so then no other question arises. But in
the face of the finding of the Tribuanal that the reorganisation scheme
rendered some workers surplus and that the scheme had seriously prejudiced the
workers, and that the apprehension of the workers that the reorganisation would
result in some member of the staff becoming surplus came true, it cannot be
said that the failure of the employer to give notice under section 9A and introducing
the scheme of reorganisation without such notice is justified. It means that
the workers were justified in refusing to work under the new scheme. It follows
that the refusal to pay their wages amounted to alteration of conditions of
service and the applications were, therefore, rightly made under section 33A.
Even apart from that it was urged by Mr.
Gupte relying upon the decision in National Coal Co. v. L. P. Dave(1) that non-
payment of wages was neither an alteration in, the conditions of service nor is
it a punishment and as such cannot come within the mischief of section 33 of
The Patna High Court relied also for its
decision on the decision in Shama Biscuit Co. v. Their Workmen(2). The facts of
that case are not quite clear, The Court gives no reason for its view that the
non-payment of wages is not an alteration of conditions of service applicable
to workmen and that it was only a case of default of payment of wages on the
pay day falling under Payment of Wages Act. The facts there were in any case
different from the facts of the present case. We may refer to the decision of
the Allahabad High Court in Rain Nath Koeri v.Lakshmi Devi Sugar Mills &
Ors. (3) where it was observed that the payment of wages is one of the
essential ingredients of the contract of employment and that the word
'conditions' includes the idea conveyed by the word 'terms' but goes beyond it
and is not confined, to what is included in that word. The Court also held that
'terms and conditions of employment' is wider in.
scope than the expression 'terms and
conditions of labour'.
But as we have already observed failure or
refusal to pay wages for a certain period may necessitate proceeding under
section 33C, but refusal to pay wages indefinitely on the refusal of the
workers to work according to a scheme of reorganisation which was not a valid
one, because of the failure to give notice under section 9A, cannot but be
considered to be an alteration in the conditions of service of the workers.
Mr. Gupte complained that the Tribunal has
not decided the question whether the reorganisation was justified. He also
contended that the applications by the workers as well as the reference (1)
A.I.R. 1956 Patna 294.
(3)  2 L.L.J. 11.
(2)  2 L.L.J. 353.
636 made by the company should have been
heard together and should not have been disposed of separately. That is really
the main complaint of the employer. As we have pointed out earlier if all the
evidence which was let in the reference were available to tile Tribunal which
decided the applications of the workers, the result might well have been
different. But we do not consider that the Tribunal was wrong in having
proceeded to dispose of the matter in the way it did. Mr. Tarkunde rightly
contended that even if an application had been made under section 33C, the
whole scheme would have to be considered and it is not fair at this distance of
time to drive the workers to file applications under section 33C, the procedure
for which would be the same as under section 33A, merely on the ground that the
introduction of the scheme had taken place before the reference to adjudication
was made. We consider that as an application under section 33A has to be
decided as if it were a reference under section 10, the fact that the scheme
had been introduced earlier than the reference to arbitration under section 10,
does not bar-,an application under section 33A in the circumstances we have
We thus come to the conclusion (1) that
non-payment of wages in the circumstances of this case amounts to an alteration
in the conditions of service, (2) the fact that the scheme was introduced
before the reference under section 10 was made does not bar an application
under section 33A, and (3) that the Tribunal was justified in coming to the
conclusion that this alteration in the conditions of service could not have
been made without notice under section 9A.
The result is that all the appeals are
dismissed. There will be no order as to costs.