Greaves Cotton and Co. & Ors Vs.
Their Workmen  INSC 219 (14 November 1963)
14/11/1963 WANCHOO, K.N.
GUPTA, K.C. DAS
CITATION: 1964 AIR 689 1964 SCR (5) 362
R 1966 SC 305 (41) RF 1967 SC1175 (12) R 1967
SC1286 (8) R 1969 SC 360 (20) R 1972 SC 319 (10) RF 1972 SC2273 (20) R 1972
SC2332 (31,70,71,113,118) RF 1973 SC2758 (11) R 1974 SC 526 (15) RF 1975 SC1778
(20) R 1978 SC 982 (6,10) R 1978 SC1113 (14) R 1984 SC 356 (14) RF 1986 SC 125
(14) RF 1986 SC1794 (7)
Scales-Industry-cum-region formula- Applicability-Division of unskilled workers
into two classes, if permissible-Dearness allowance-Incremental
The disputes between the appellant companies
and the workmen which were referred to the Industrial Tribunal for
adjudication, related to wages, dearness allowance and gratuity. The companies
raised objections to the award of the Tribunal on various grounds.
Held:(i) The reference in the award to the
recommendations of the Tripartite Conference wherein the need-based minimum
wage was evolved, did not vitiate the award, as the final decision was based
not on them but on a consideration of the wages prevalent incomparable concerns
so far as clerical and subordinate staff were considered.
(ii) In applying the industry-cum-region
formula for fixing wage scales the Tribunal should lay stress on the industry
part of the formula if there were large number of concerns in the same region
carrying on the same industry, but where the number of industries of the same
kind in a particular region was small, it was the region part of the formula
which assumed importance particularly in the case of clerical and subordinate
In the present case, the Tribunal was right
in leaning more on the region part of the industry-cum-region formula and less
on the Industry part.
Workman of Hindustan Motors v. Hindustan
Motors,  2.
J.352 and French Motor Car Company v. Their
Workman  Supp. 2. S.C.R. 16 considered.
(iii)The Tribunal was not justified in
creating two classes of higher unskilled and lower unskilled in the category of
unskilled factory-workmen in the matter of fixation of wage-scales.
(iv)Employees getting same wages should get
the same scales of dearness allowance irrespective of whether they were working
as clerks, or members of subordinate staff or factory-workmen.
(v)In fixing the same rates of dearness
allowance for factory workmen as for clerical staff, it was necessary for the
Tribunal when making comparisons to take into account the total wage packet and
then compare it with the total wage packet of comparable 363 concerns and thus
arrive at a just figure for basic wage for each category of factory-workmen.
(vi)There is nothing in law to prevent an
industrial tribunal from granting adjustments to the employees in the revised
wage scales even in a case where previously pay- scales were in existence, but
this has to be done sparingly, taking into consideration the facts and
circumstances of each case.
CIVIL APPELLATE JURISDICTION: Civil Appeals
Nos. 272 to 280 of 1962.
Appeals by special leave from the Award dated
June 3, 1960, in reference (IT) Nos. 84 and 251 of 1959, June 15, 1960, in
References (IT) Nos. 112 and 252 of 1959, June 16, 1960, in References (IT)
Nos. 121 of 1959, and 7 of 1960, June 15, 1960, in References (IT) Nos. 123,
180 and 236 of 1959 of the Industrial Tribunal, Maharashtra at Bombay.
S.V. Gupte, Additional Solicitor-General N.
V. Phadke, J. B. Dadachanji, O. C. Mathur and Ravinder Narain for the
appellants (in all the appeals).
M.C. Setalvad, K.T. Sule, Madan G. Phadnis,
Jitendra Sharma and Janardan Sharma, for the respondents (in C.A. No. 272/1962).
K.T. Sule, Madan G. Phadnis, Jitendra Sharma
and Janardan Sharma, for the respondents (in C. As. Nos. 273-280/62).
November 14, 1963. The Judgment of the Court
was delivered by WANCHOO J.-These nine appeals by special leave arise out of
the awards of the Industrial Tribunal, Bombay and will be dealt with together.
There were disputes between the four appellants--companies and the respondents,
their workmen, which were referred for adjudication to the Industrial Tribunal
by nine reference-orders on various dates between April to December 1959. The
main dispute which gave rise to the references was with respect to wages,
dearness allowance and gratuity. The references included other items also but
we are not concerned in the present appeals with those items. Of the four
companies who are the appellants before 364 us, Greaves Cotton and Co., is the
first company and its main activity is to invest money in manufacturing
The second company is Greaves Cotton and
Crompton Parkinson Private Limited and its main business is distribution of the
products of a manufacturing concern known as Crompton Parkinson (Works) India
Limited and service and repair to the said products at its workshop. The third
company is Konyon Greaves Private Limited and its main business is to
manufacture high grade interstranded ropes for the textile industry. The last
company is Ruston and Hornsby (India) Private Limited and its main business is
to manufacture oil engines and pumps. The last three companies are controlled
by the first company, namely Greaves Cotton and Co., in one way or the other
and that is how the main dispute relating to wages and dearness allowance was
dealt with together by the tribunal. There were two references each with
respect to the first three companies and three references with respect to
Ruston and Hornsby Private Limited; and that is how there are nine appeals
before us. There were nine awards, though the main award dealing with the main
dispute relating to wages and dearness allowance was common.
It appears that wages and dearness allowance
prevalent in the four companies had been continuing since 1950 when the last
award was made between the parties. It may also be stated that there was no
.serious dispute before the Tribunal as to the financial capacity of the
companies and further, as the first company controls the other three companies,
the wages and dearness allowance are the same so far as the clerical and
subordinate staff are concerned.
The same appears to be the case with respect
to factory- workmen.
The Tribunal dealt with clerical and
subordinate staff separately from the factory-workmen. So far as the clerical
and subordinate staff are concerned, the Tribunal, after a comparison of wages
and dearness allowance prevalent in the four companies with wages 365 and
dearness allowance prevalent in comparable concerns revised them. Further it
provided bow the clerical and subordinate staff would be fitted in the new
scales after making certain adjustments and in that connection it gave one to
three extra increments depending upon length of service between 1950 to 1959.
Finally, it ordered that the award would have effect from April 1, 1959, which
was a week before the first reference was made with respect to the first
company. The Tribunal then dealt with the case of the factory-workmen and
prescribed certain rates of wages.
Further it gave the same dearness allowance
to the factory- workmen as to the clerical and subordinate staff and directed
adjustments also on the same basis. Finally it considered the question of
gratuity and the main provision in that respect was that the maximum gratuity
allowable would be upto 20 months and a provision. was also made to the effect
that if an employee was dismissed or discharged for misconduct which caused
financial loss to the employer, gratuity to the extent of that loss only will
not be paid to the employee concerned.
The main attack of the appellants is on the
award as regards wages and dearness allowance. It is urged that the
industry-cum-region formula, which is the basis for fixation of wages and
dearness allowance has not been properly applied by the Tribunal and it had
been carried away by the recommendations of the tripartite conference which
suggested need based minimum wages. It is also urged that whatever comparison
was made was with concerns which were not comparable and the wages awarded were
even higher than those prevalent in any comparable concern. It is also urged
that the Tribunal did not consider the total effect of the increase it was
granting in basic wage and dearness allowance together as it should have done,
for the purpose of finding out whether the total pay packet in the appellants'
concerns can bear comparison with the total pay packet of the concerns with
which the Tribunal had compared the appellants' concerns. In this connection it
is urged that in flying 366 scales of wages the Tribunal increased the maximum
and the minimum and the annual rate of increment and decreased the span of
years in which the maximum would be reached.
Adjustments made by the Tribunal are also
attacked and so is the order making the award enforceable from April 1, 1959.
As to the factory workmen it is urged that
the Tribunal made no attempt to make a comparison with wages prevalent even in
what it considered to be comparable concerns. Lastly it is urged that the Tribunal
created a new category of factory workmen called higher unskilled which was not
demanded and which in any case did not exist in any comparable concern.
The first question therefore which falls for
decision is whether the Tribunal went wrong in not following the
industry-cum-region principle and in leaning on the recommendations of the
Tripartite Conference. It is true that the Tribunal begins its award with a
reference to the recommendations of the Tripartite Conference wherein the
need-based minimum wage was evolved. It is urged that this disposed the
Tribunal to pitch wage-scales too high. It is however clear from the award that
though the Tribunal discussed the recommendations of the Tripartite Conference
at some length, when it actually came to make the award it did not follow those
recommendations. The reason why it referred to those recommendations was that
the respondents- workmen based their claim on them and wanted that the Tribunal
should fix wage scales accordingly. But the Tribunal's conclusion was that it
was not feasible to do so, though looking at the financial stability of the
appellants, emoluments needed upgrading. It then went on to consider the wages
prevalent in comparable concerns and finally fixed wages for the appellants on
the basis of wages prevalent in such concerns. Though therefore the
recommendations of the Tripartite Conference are referred to in the Tribunal's
award, its final decision is not based on them and what the Tribunal has done
is to make comparisons with what it considered comparable concerns so far as
clerical and subordinate staff are concerned. We are therefore not prepared to
say that reference to the recommendations of the Tripartite Conference in the
opening part of the award was irrelevant and therefore the rest of the award
must be held to be vitiated on that ground alone.
The main contention of the appellants however
is that the tribunal has gone wrong in applying the industry-cum-region formula
which is the basis for fixing wages and dearness and has made comparison with
concerns which are not comparable.
It is also urged that the Tribunal has relied
more on the region aspect of the industry-cum-region formula and not on the
industry aspect when dealing with clerical and subordinate staff and in this it
went wrong. Reference in this connection is made to two decisions of this
Court, namely, Workmen of Hindusthan Motors v. Hindusthan Motors(',) and French
Motor Car Company v. Their Workman (2 ) and it is emphasis that the principles
laid down in Hindusthan Motors' case(") were more applicable to the
present case than the principles laid down in the French Motor Car Co.'s
case(2). In the Hindusthan Motors case(1), this Court observed that it was
ordinarily desirable to have as much uniformity as possible in the wage-scales
of different concerns of the same industry working in the same region, as this
puts similar industries more or less on an equal footing in their production
struggle. This Court therefore applied the wage-scales awarded by the Third Major
Engineering Tribunal in Bengal in the case of Hindusthan Motors also. It is
urged that the Tribunal should have taken into account comparable concerns in
the same industry and provided wage-scales on the same lines so that, so far as
manufacturing concerns in the present appeals are concerned, there will be
equality in the matter of competition. In the French Motor Car Co.'s case(2)
however this Court held so far as clerical staff and subordinate staff are
concerned that it may be possible to take into account (1)  2 L.L.J. 352.
(2)  Supp. 2 S.C.R. 16 368 even those
concerns which are engaged in different lines of business for the work of
clerical and subordinate staff is more or less the same in all kinds of
concerns. We are of opinion that there is no inconsistency as urged in the
principles laid down in these two cases. As we have already said the basis of
fixation of wages and dearness allowance is industry-cum-region. Where there
are a large number of industrial concerns of the same kind in the same region
it would be proper to put greater emphasis on the industry part of the
industry-cum-region principle as that would put all concerns on a more or less
equal footing in the matter of production costs and therefore in the matter of
competition in the market and this will equally apply to clerical and
subordinate staff whose wages and dearness allowance also go into calculation
of production costs. But where the number of comparable concerns is small in a
particular region and therefore the competition aspect is not of the same
importance, the region part of the industry-cum-region formula assumes greater
importance particularly with reference to clerical and subordinate staff and
this was what was emphasised in the French Motor Car Co.'s case() where that
company was already paying the highest wages in the particular line of business
and therefore comparison had to be made with as similar concerns as possible in
different lines of business for the purpose of fixing wage-scales and dearness
allowance. The principle therefore which emerges from these two decisions is
that in applying the industry- cum-region formula for fixing wage scales the
Tribunal should lay stress on the industry part of the formula if there are a
large number of concerns in the same region carrying on the same industry; in
such a case in order that production cost may not be unequal and there may be
equal competition, wages should generally be fixed on the basis of the
comparable industries, namely, industries of the same kind. But where the
number of industries of the same kind in a particular region is small it is the
region part of the industry-cum-region formula which (1)  Supp. 2s C.R.
369 assumes importance particularly in the
case of clerical and subordinate staff, for, as pointed out in the French Motor
Car Co.'s case,(" there is not much difference in the work of this class
of employees in different industries. In the present cases it does appear that
the Tribunal has leaned more on the region part of the industry-cum-region
formula and less on the industry part. But we think that it cannot be said that
the Tribunal was wrong in doing so for two reasons. In the first place these
four companies are not engaged in the same line of industry; but on account of
certain circumstances, namely, that Greaves Cotton and Co. is the controlling
company of the other three, it has been usual to keep the same scales for
clerical and subordinate staff in all these concerns. In the second place, it
is not clear, as was clear in the Hindusthan Motors case(" that there are
a large number of comparable concerns in the same region. As a matter of fact
the main company out of these four is Greaves Cotton and Co. Limited, which is
in the main an investment and financial company and the Tribunal was therefore
right in taking for comparison such companies as would stand comparison with
the main company in the present appeals (namely, Greaves Cotton & Co).
Both parties filed scales of wages prevalent
in what they considered to be comparable concerns and it is clear from the
documents filed that some of the comparable concerns were the same in the
documents filed by the two parties. On the whole therefore we do not think the
Tribunal was wrong in putting emphasis on the region aspect of the
industry-cum-region formula in the present case insofar as clerical and
subordinate staff was concerned., for the four companies before us do not
belong to the same industry and Greaves Cotton and Co. controls the other
Considering therefore the standing of the
main company (namely, Greaves Cotton and Co. Ltd.), it was not improper for the
Tribunal in the present cases to rely on the comparable concerns (1) 
Supp. 2 S.C.R. 16 1/SCI/64 --- 24 (2)  2 L.L.J. 352.
370 which were cited on behalf of the
respondents, some of which were common with the comparable concerns cited on
behalf of the appellants. What the Tribunal lid thereafter was to consider the
minimum for various categories of clerical and subordinate staff prevalent in
these comparable concerns and the maximum prevalent therein at-id also the
annual increments and the span of years in which. the maximum would be reached.
The Tribunal then went on to fix scales for various categories of clerical and
subordinate staff of the appellants which were in-between the scales found in
various concerns. Further, as the financial capacity of the appellants was not
disputed, the Tribunal pitched these scales nearer the highest scales taking
into account the fact that for nine years after 1950 there had been no increase
in wage scales. We do not think therefore that the wage sales fixed by the
Tribunal, learning as it did, on the region aspect of the industry-cum-region
formula, for the clerical and subordinate staff can be successfully assailed by
It has however been urged that the Tribunal
overlooked considering what would be the total wage packet including basic
wages and dearness allowance and that has made the total wages (i.e. basic wage
and dearness allowance) fixed by the Tribunal much higher in the case of the
appellants than in comparable concerns which it took into account. It is true
that the Tribunal has not specifically considered what the total wage packet
would be on the basis of the scales of wages and dearness allowance fixed by it
as it should have done; but considering that wage scales fixed are less than
the highest in the comparable concerns though more than the lowest, it cannot
be said that the total wage packet in the case of the appellants would 'be necessarily
higher than in the case of the other comparable concerns.
This will be clear when we deal with the
dearness allowance which has been fixed by the Tribunal, for it will appear
that the dearness allowance fixed is more or less on the same lines, i.e. less
than 371 the highest but more than the lowest in other comparable concerns. On
this basis it cannot be said that the total wage packet fixed in these concerns
would be the highest in the region. Though therefore the Tribunal has not
specifically considered this aspect of the matter which it should have done its
decision cannot be successfully assailed on the ground that the total wage
packet fixed is the highest in the region.
This brings us to the case of
factory-workmen. We are of opinion that there is force in the contention of the
appellants insofar as the fixation of wage scales for factory-workmen is
concerned. The respondents wanted that separate wages should be fixed for each
category of workmen.
The Tribunal however rejected this contention
and held that the usual pattern of' having unskilled, semi-skilled and skilled
grades should be followed and the various workmen, though they should be known
by their designation and not by the class in which they were being placed,
should be fitted in these categories. In the present concerns, there were six
categories from before, namely (i) unskilled, (ii) semiskilled 1, (iii)
semiskilled If, (iv) skilled 1, (V) skilled 11, and (vi) skilled 111. The
Tribunal kept these categories though it introduced a seventh category called
the higher unskilled. It is not seriously disputed that this category of higher
unskilled does not exist in comparable concerns; nor have we been able to
understand how the unskilled category can be sub-divided into two namely, lower
and higher unskilled, though we can understand the semi-skilled and skilled
categories being sub-divided, depending upon the amount of' skill. But there
cannot be degrees of want of skill among the unskilled class. The Tribunal
therefore was not justified in creating the class of higher unskilled. It is
neither necessary nor desirable to create a higher unskilled category and only
the six categories which were prevalent from before should continue.
The main attack of the appellants on the
wages fixed for these six categories is that in doing so, the 372 Tribunal
completely overlooked the wages prevalent for these categories in concerns
which it had considered comparable.
A look at the award shows that it is so. The
Tribunal has no where considered what the wages for these categories in
comparable concerns are, though it appears that some exemplars were filed
before it; but the way in which the Tribunal has dealt with the matter shows
that it paid scant regard to the exemplars filed before it and did not care to
make the comparison for factory-workmen in the same way in which it had made
comparison for clerical and subordinate staff. In these circumstances,
wage-scales fixed for factory-workmen must be set aside and the matter remanded
to the Tribunal to fix wage-scales for factory-workmen dividing them into six
categories as at present and then fixing wage after taking into account wages
prevalent in comparable concerns. The parties will be at liberty to lead
further evidence in this connection.
Then we come to the question of dearness
allowance. So far as clerical staff is concerned, dearness allowance prevalent
in the appellants' concerns was as follows on the cost of living index of
411-420:- Basic salary D.A at cost of Verification for in Rs. living index
every 10 point group 411-420 movement 1 to 100 115% of basic salary 5% or the
textile scale on 30 day month whichever is higher 101 to 200 35% 1 1/2% 201 to
300 25% 1% 301 and above 17 1/2% 3/4% 373 The Tribunal fixed the dearness
allowance as follows:- When the consumer Variation for Salary slab price index
each 10 point rise is between 411. or fall in the 420 index On 1st Rs. 100 115%
5% On 2nd Rs. 100 50% 2.% On 3rd Rs. 100 25% 1%.
Balance upto 20% 1.% Rs. 600 A comparison of
these figures will show that on the first hundred and the third hundred there
is no difference in the scale fixed by the Tribunal; but there is a slight
improvement on the second hundred and a very slight one above three hundred.
This scale fixed by the Tribunal is in line with some scales of dearness
allowance recently fixed by Tribunals in that region. The main improvement is
on the second hundred and it cannot really be said that employees in that wage
range do not require the higher relief granted to them by tribunals in view of
the rise in prices. We do not think therefore that the dearness allowance fixed
by the Tribunal, taking into account what was already prevalent in these
concerns and also taking into account the trend in that region, can be
successfully assailed so far as clerical staff' is concerned.
This brings us to the case of subordinate
staff. It appears that in these concerns, subordinate staff was getting
dearness allowance on different scales based on the old textile scale of
dearness allowance. The Tribunal has put the subordinate staff in the same
scale of dearness allowance as clerical staff. The reason given by it for doing
so is that incongruity in the payment of dearness allowance between clerical
and subordinate staff should be removed. It appears that on account of
different scales of 374 dearness allowance for subordinate and clerical staff a
member of 'the subordinate staff drawing the same wages would get less dearness
allowance than a member of the clerical staff. The discrepancy is very glaring
as between clerical staff and factory-workmen who also have different scales of
dearness allowance. The Tribunal therefore thought that dearness allowance
which is meant to neutralise the rise in cost of living, should be paid to
clerical staff, subordinate staff as well as factory workmen on the same scale,
for the need for neutralisation was uniformly felt by all kinds of employees.
It also pointed that there was a trend towards uniformity in the matter of
scales of dearness allowance as between clerical staff and other staff and
factory workmen and referred to a number of firms where same scales prevailed
for all the staff. It has however been urged on behalf of the appellants that
the pattern in the region is that there are different scales of dearness allowance
for clerical staff and other staff including factory workmen and the Tribunal
therefore should have followed this pattern. The reasons given by the Tribunal
for giving the same scales of dearness allowance to all the categories of
staff, including the factory-workmen appear to us to be sound. Time has now
come when employees getting same wages should get the same dearness allowance
irrespective of whether they are working as clerks, or members of subordinate
staff or factory-workmen. The pressure of high prices is the same on these
various kinds of employees. Further subordinate staff and factory workmen these
days are as keen to educate their children as clerical staff and in the
circumstances there should be no difference in the amount of dearness allowance
between employees of different kinds getting same wages. Further an employee
whether he is of one kind or another getting the same wage hopes for the same
amenities of the and there is no reason why he should not get them, simply
because he is, for example, a factory workman, though he may be coming from the
same class of people as a member of clerical staff. On the whole therefore the
Tribunal was in 375 our opinion right in following the trend that has begun in
this region and in fixing the same scale of dearness allowance for subordinate
staff and factory workmen as in the case of clerical staff. So far therefore as
subordinate and clerical staff are concerned, we see no reason to disagree with
the rate of dearness allowance fixed by the Tribunal.
This brings us to the case of the dearness
allowance for factory-workmen. In their case we have set aside the award
relating to wage scales. It follows that we must also set aside the award
relating to dearness allowance as we have already indicated that the Tribunal
has to take into consideration the total pay packet in fixing wages and
dearness allowance. When therefore the case goes back to the Tribunal for
fixing wages and dearness allowance for factory-workmen, it will be open to the
Tribunal to fix the same rates of dearness allowance for factory workmen as for
clerical staff; but in doing so the Tribunal must when making comparisons take
into account the total wage packet (i.e. basic wages fixed by it as well as
dearness allowance) and then compare it with the total wage packet of
comparable concerns and thus arrive at a just figure for basic wage, for each
category of factory-workmen. But the entire matter is left to the Tribunal and
it may follow such method as it thinks best so long as it arrives at a fair
conclusion after making the necessary comparison.
This brings us to the question of adjustment.
We have already said that the Tribunal allowed one to three increments
depending upon the length of service between 1950 and 1959. It has been urged
that no adjustment should have been allowed taking into account the fact that
incremental scales were in force previously also in these concerns and the
Tribunal has increased both the minimum and the maximum in its award and has
granted generous annual increments reducing the total span within which a
particular employee belonging to clerical and subordinate staff will reach the
maximum. Reliance in this connection has been placed on the 376 French Motor
Car Co.'s case (". It is true that the Tribunal has given larger
increments thus reducing the span of years for reaching the maximum. That alone
however is no reason for not granting adjustment. But it is said that in the
French Motor Co. case('-', this Court held that where scales of pay were
existing from before no adjustment should be granted by giving extra increments
and that case applies with full force to the facts of the present case. Now in
that case this Court pointed out on a review of a large number of awards
dealing with adjustments that "generally adjustments are granted when
scales of wages are fixed for the first time. But there is nothing in law to
prevent the industrial tribunal from granting adjustments to the employees in
the revised wage scales even in a case where previously pay-scales were in
existence; but this has to be done sparingly taking into consideration the
facts and circumstances of each case. The usual reason for granting adjustment
even where wage-scales were formerly in existence is that the increments
provided in the former wage-scales were particularly low and therefore justice
required that adjustment should be granted a second time." Another reason
for the same was that the scales of pay were also low. In those circumstances
adjustments have been granted by tribunals a second time. This Court then
pointed out in that case that the incremental scales prevalent in that company
were the highest for that kind of industry and therefore struck down the
adjustments granted and ordered that clerical staff should be fixed on the next
higher step in the new scales if there was no step corresponding to the salary
drawn by a clerk in the new scale. The question therefore whether adjustment
should be granted or not is always a question depending upon the facts and
circumstances of each case.
Let us therefore see what the circumstances
in the present cases are. Tables of comparative rates of increments were filed
before the Tribunal (1)  Supp. 2 S.C.R. 16.
377 for various grades of clerks. It is clear
from the examination of these tables and pay-scales prevalent in the
appellants' concerns from 1950 that pay scales were not high as compared to pay
scales in comparable concerns. If anything, they were on the low side. Further,
as an example, in the case of junior clerks, the first rate of increment was
Rs. 5 in the appellants' concerns and this rate went on for 13 years; in other
concerns where the first rate of increment was Rs. 5 it lasted for a much
shorter period, which in no case exceeded eight years and was in many cases three
or four years. In some concerns the first rate of increment was higher than Rs.
5. Almost similar was the case with senior clerks. So it appears that in the
appellants' concerns the first rate of increment was generally on the low side
and lasted for a longer period than in the case of comparable concerns. In
these circumstances if the Tribunal decided to give increments by way of
adjustments it cannot be said that the Tribunal went wrong. The facts 'in these
cases are different from the facts in the case of the French Motor Car Co.'s
case(2) and therefore (1) we see no reason for interfering with the order of
adjustment. After the change in wage-scales, dear- ness allowance and
adjustment, the employees of the appellants' concerns will stand comparison with
some of the best concerns in that region. But considering that there is no
question of want of financial capacity and that Greaves Cotton & Co. which
is the main company concerned in these appeals, has a high standing in that
region, we do not think that the total wage packet fixed is abnormal or so
disproportionate as compared to the total wage packet in other comparable
concerns as to call for any interference with adjustments.
The next question is about the so-called
retrospective effect of the award. The first reference was made to the Tribunal
on April 8, 1959, while the last was in December 1959. What the Tribunal has
done is to grant wage-scales etc., from April 1, 1959. This cannot in our
opinion be said to be really (1) Supp. 2 S.C.R. 16.
378 retrospective, because it is practically
from the date of the first reference in the case of the main company. On the
whole therefore we see no reason to interfere with the order of the Tribunal
fixing the date from which the award would come into force.
Lastly we come to the question of gratuity.
The attack in this connection is on two aspects of the gratuity scheme.
The first is about the fixation of 20 months
as the maximum instead of' 15 months, which was usual so far, The second is
with respect to deduction from gratuity only to the extent of the financial
loss occasioned by misconduct in case of dismissal for misconduct. So far as
the second provision is concerned it cannot be disputed that this is the usual
provision that is being made in that region. So ear as the increase in the
maximum from 15 months to 20 months is concerned, it appears that the Tribunal
has relied on a number of cases in which the maximum is higher than fifteen
months wages. In these circumstances considering that tri- bunals have now
begun to, give a higher ceiling and in one concern, namely Mackinnon Mackenzie,
the ceiling has been fixed even so high as thirty moths by agreement, we do not
think that any interference is called for in the present case.
We therefore dismiss the appeals so far as
retrospective effect and adjustments as also fixation of wages and dearness
allowance with respect to clerical and subordinate staff are concerned. We
allow the appeal with respect to factory-workmen and send the cases back to the
Tribunal for fixing the wage structure including basic wage and dearness
allowance and for granting adjustments in the light of the observations made by
us. The new award pursuant to this remand will also come into force from the
same date, namely, April 1, 1959. The appeals with respect to gratuity are
dismissed. In the circumstances we order parties to bear their own costs. Two
months from today is allowed to pay up the arrears.
Appeal partly allowed and remanded.