State Bank of Bikaner & Jaipur Vs.
Shri Hari Har Nath Bhargava  INSC 189 (11 August 1971)
REDDY, P. JAGANMOHAN
CITATION: 1971 AIR 2200 1972 SCR (1) 110 1971
SCC (2) 591
Industrial Disputes Act, 1947, s.
33C(2)-Sastry Award-Power of Attorney entrusting supervisory work-If entitled
to supervisory allowance for period when not called upon to discharge
The respondent, a clerk of the appellant
bank, was entrusted with supervisory work and a general power of Attorney was
executed in his favour to endorse Hundies cheques, warranty, Railway receipts,
pension bills and other negotiable and mercantile instruments and to prosecute,
defend, answer and oppose any suit etc. on behalf of the appellant bank.
The respondent filed an application before
the Labour Court, Rajasthan under s. 33C (2) of the Industrial Disputes Act,
praying for computation of special allowance under the Sastri Award, on the
ground that he was discharging supervisory duties.
The Labour Court, allowed supervisory
allowance of Rs. 40 p.m. with consequential benefits. In appeal to this Court
the appellant bank ,contended that since the respondent was not called upon to
perform the functions enumerated in the power of attorney, he is not entitled
to any special allowance.
Dismissing the appeal.
HELD : (i) The payment of a special allowance
was called for when an employee discharged duties of a supervisory nature or
was accorded the status of a person competent to discharge functions of a
supervisory character. [115d] (ii) Since the Management by the power of
Attorney, had placed the respondent in a category of persons with
responsibility and entrusted him with functions of a supervisory character and
the employee was to discharge that responsibility, he was entitled to
supervisory allowance no matter, whether he was actually called upon to
discharge such functions or not for a certain period of time. [1 15F, 11 6B]
State Bank of' Hyderabad v. V. A. Bhinde,  2 L. L. J.
713, referred to.
CIVIL APPELLATE JURISDICTION: Civil appeal
No. 1923 of 1966.
Appeal by special leave from the order dated
February 14, 1966 of the Central Govt. Labour Court, Rajasthan, Jaipur in Misc.
Application No. CLC-4 of 1964.
G. L. Sanghi and P.M. Tiwari for the
111 M. K Ramamurthi, J. Ramamurthi and Vineet
Kumar, for the respondent.
The Judgment of the Court was delivered by
Mitter, J. This appeal by special leave is from an order of the Central
Government Labour Court, Rajasthan passed on February 14, 1966 on an
application under S. 33-C (2) of the Industrial Disputes Act filed by the
respondent, Hari Har Nath Bhargava, holding that the latter was entitled to
supervisory allowance under paragraph 164 (b) (9) of the Sastry Award even for
the period when the latter was not actually performing supervisory duties.
The facts in this case may be shortly stated.
The respondent was appointed a clerk by the State Bank of Jaipur in 1949. He
was transferred to Kota in the year 1952. He was entrusted with supervisory
work from 6th April, 1954.
The bank executed a power-of-attorney in his
favour on May 31, 1954 in pursuance of a resolution of its Board of Directors
passed on 20th May, 1954. He was transferred from Kota to Jaipur on July 12,
1955. On December 27, 1955 he was posted at Sikar where he had to perform
supervisory duties. On January 1, 1956 he was promoted to the cadre of junior
officers of the bank.
On March 31, 1964 the respondent filed an
application before the Central Government Labour Court, Rajasthan under S. 33-C
(2) praying for computation of special allowance under what is known as the
Sastry Award on the ground that he had been discharging supervisory duties from
6th April, 1954 to 1st January, 1956. By this time the Bank of Jaipur had
amalgamated with the Bank of Bikaner and the amalgamated bank, the appellant
before us, came to be known as the State Bank of Bikaner and Jaipur. The
execution of the power of attorney dated 29th May, 1954 was admitted but the
appellant denied "that the duties entrusted to the respondent constituted
performance by him of any supervisory nature of work". A point was also
taken that although no period of limitation is laid down by any statute with
regard to applications under S. 33-C of the Act the respondent's claim being a
stale one should not be entertained.
112 The appellant amended its written
statement in 1965 wherein it was stated that the respondent was only required
to perform the functions enumerated in the power of attorney as and when so
directed by the bank. As a matter of fact, he had been entrusted with
supervisory duties from 6th April, 1954 to 12th July, 1955 and thereafter from
27th December, 1955 to 6th January, 1956.
The respondent was examined before the Labour
Court where he said that he was "the second signatory at Kota during the
period, April 1954 to middle of July 1955". At the Jaipur branch where he
was transferred, there were many signatories above him, while at Sikar there
was only another such signatory and he was the second officer. Obviously what
he meant by the word "signatory" was a person authorised by the bank
to discharge the functions covered by the power of attorney.
The relevant portion of the said power of
attorney read "The Bank do here by nominate constitute and appoint Shree
Hari Har Nath Bhargava in the service of the said bank at Kota to be the true
and lawful attorney of the said bank at its registered office at Jaipur
aforesaid or at any other place or places in India where the said bank may have
or establish branches or agencies and to which he may from time to time or at
any time be appointed by the said bank as Branch Manager, Agent, Sub-Agent,
Accountant, or in any capacity whatever for and in the name of and on behalf of
the said bank to do, transact jointly with Secretary, Manager, Sub-Manager etc.
the matters and things mentioned thereafter." The matters mentioned
included the endorsement of "hundies, drafts, cheques, warrants, railway
receipts, pension bills and other negotiable and mercantile instruments and to
commence, prosecute, enforce, defend, answer and oppose any suit or other legal
proceedings and demands touching any matters in which the bank was or may
thereafter be interested or concerned." 113 It is worthy of note that
after the execution of the power of attorney the respondent was empowered to,
discharge functions which could only be described as. supervisory in nature and
unless there was a command or direction that he should not act thereon or
unless the power of attorney was cancelled his authority, to act in a
supervisory capacity would continue in force.
The Sastry Award is not on record in extenso
but paragraph 164 thereof quoted by the Labour Court shows; that certain
categories of employees were to be considered as fit for special allowances.
These included inter alia stenographers, cashiers (other than routine clerks),
supervisors, clerks-in-charge, departmental-in-charges and head clerks. The
award noted that although scales of basic pay and dearness allowance for
clerical and subordinate staffs had been laid down for doing ordinary duties,
there were certain posts even in these grades for which an incumbent required
special qualifications or skill for the efficient discharge of the duties
assigned and an extra payment in such cases was necessary by way of,
recognition of and compensation for the skill or responsibility. The award
further noted that :
"Having regard to the numerous banks of
varying sizes and resources, it is not possible to have one general pattern of
allowances for such special types of work....... It is neither easy nor
desirable to bring them all into one fairly general rule regardless of the
bank's past practice or present capacity." Paragraph 162 of the award
shows that there were three, ways in which this extra payment might be provided
for (1) The employee might be given additional increments in the same scale.
(2) He might be paid a lump-sum allowance in
addition to his other emoluments. This was said to have the advantage of
carrying a man even beyond the usual maximum limit.
(3) He might be given a higher scale leading
up to a higher maximum.
114 According to the award it was on the
whole better to adopt either the first or the second method or sometimes even a
combination of both.
According to the Labour Court the underlying
idea behind the said award was that when one general scale for clerical service
had been provided in the award, it was thought just and proper that persons
with special qualifications or skill required for discharging work carrying
with it greater responsibility than the usual work should definitely get higher
emoluments than the ordinary workmen. The Labour Court said that "this did
not mean that the person of the same qualifications and skill who had been
granted the powers of attorney by the bank should be allowed special allowance
only for any particular period unless a man was temporarily appointed to do
supervisory work". In the result, the Labour Court allowed the respondent
supervisory allowance at Rs. 40 p.m. with ,effect from 6th April, 1954 to 31st
December, 1955 with, consequential benefits.
It is to be noted however that although a
point had been taken in the written statement of the bank about the delay in
the filling of the application under S. 33-C it had not been pressed before the
Mr. Sanghi appearing for the appellant was
prepared to concede that so far as the periods 6th April, 1954 to 12th July,
1955 and 27th December, 1955 to 31st December, 1955 were concerned he was not
contesting the claim. But in so far as the period 13th July, 1955 to 27th December,
1955 was concerned, his client was pressing the appeal as a matter of principle
as this would constitute a test case by which other similar cases might fall to
This Court had to deal with a case where an
identical question arose. In State Bank of Hyderabad v. V. A. Bhide (1) this
Court had to consider the claims of the respondents in that appeal for payment
of special allowance granted to supervisors under what were known as the Sastry
and Desai awards. It was there contended on behalf ,of the appellant bank that
in order to claim the supervisory allowance the parties must establish that the
main or essential duties entrusted to them and actually discharged by (1)
2 L.L.J. 713.
them were duties and functions of a
This Court considered the Sastry and Desai
awards and observed (at p. 727) :
"..before a person can claim the
supervisory special allowance, he must establish that he has discharged the
duties and functions which are similar to 0r the same as the duties or functions
assigned to supervisors coming under category 9. This decision [Lloyds Bank
Ltd. v.Panna Lal Gupta and others (1)] also makes it clear that in deciding the
status of an employee claiming the special allowance, the designation of the
employee is not decisive and what determines the status is a consideration of
the nature of the duties and functions assigned to the employee
concerned." In our view the payment of a special allowance is called for
when an employee discharges duties of a supervisory nature or is accorded the
status of a person competent to discharge functions of a supervisory character.
If no power of attorney is execute& as in this case but in fact the
employee is asked to render services of a supervisory character and the
employee does such work at the request of the bank, he becomes entailed to the
allowance. Once however a power of attorney giving the wide powers of agency as
was done in this case is executed, it should be held that the management had
placed him in a category of persons with responsibility and the employee was to
discharge the responsibility without any further request in that behalf.
It may be that the initial giving of power of
attorney was necessitated by the fact that at Kota there was only one officer
besides the respondent who could discharge duties like endorsing hundies,
drafts etc. and it became necessary for the bank to have a second officer who
could carry on this kind of work. But the power of attorney does not show that
the bank thought it necessary to-clothe the respondent with the said powers
only for discharging his duties when he was at Kota. The power of attorney was
operative at any branch of the bank irrespective of the capacity which might be
occupied by the respondent at a particular point of time.
It may be (1)  1 L.L.J. 18.
116 that at Jaipur there was a number of
officers superior to the respondent who were empowered to discharge duties
mentioned in the power of attorney but this does not necessarily lead to the
inference that the respondent lost his responsibility or was denuded of the
powers while he was at Jaipur. If he discharged any of the duties men- tioned
in the power of attorney the same would be lawful and would be binding on the
bank. The fact that he was not actually called upon to discharge such functions
did not take away from his responsibility or status of a person ,competent to
discharge functions of a supervisory character and we see no reason why he
should be deprived of supervisory allowance unless the bank gave him notice that
he was not to act on the power of attorney while at Jaipur.
We therefore hold that the Labour Court had
come to the correct conclusion.
Mr. Sanghi tried to urge the point that the
Labour ,Court should not have entertained the application as being inordinately
belated and that even though the Labour Court did not adjudicate on this point
it was open- to the bank to urge it before us. We made it clear that we were
not going to entertain this plea in view of the fact that although the point
had been taken in the written statement of the bank, it was not agitated before
the Labour Court and further was not taken even in the special leave petition.
In the result, the appeal is dismissed. The
order for costs made at the time of the grant of the special leave will stand.
S.C. Appeal dismissed.