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TaxTMI 
TaxTMI 
TaxTMI 
1967 (10) TMI 64
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....ayer was for a decree for Rs. 32,761 against the respondent, being the amount which the respondent had already realised from the appellant claiming that the Inam was " wages", and for costs. The case was contested by the respondent, but the Employees' Insurance Court allowed the application of the appellant, passed a decree with costs, making a declaration that Inam was not wages and that no contribution in respect of Inam paid to the workmen was payable by the appellant to the respondent, and decreeing the claim of the appellant for the sum of Rs. 32,761 against the respondent. The respondent, thereupon, appealed to the High Court of Calcutta under s. 82 of the Act. The High Court allowed the appeal, held that the Inam was wages and dismissed the claim of the appellant, but made no order as to costs. The appellant has now come up to this Court on the basis of a certificate granted by the High Court under Art. 133 of the Constitution. The decision of this appeal depends solely on the question whether the Inam paid by the appellant under the Scheme dated 28th December, 1955 is covered by the definition of "wages" as given in s. 2(22) of the Act. That definition is reproduced b....
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....n the basis of the interpretation of these terms that the Employees' Insurance Court accepted the plea of the appellant that Inam was not covered by the definition of " wages". The High Court, on interpretation of the same terms, took a contrary view. Both Courts concurrently held that the Inam paid under the Scheme was covered by the word "remuneration" used in the definition of "wages" and counsel appearing for the appellant did not challenge the correctness of this view. The Employees' Insurance Court held that the payments of Inam had nothing to do with the terms of employment and the workmen were not entitled to claim the Inam as a condition of service, so that it could not be held that this remuneration was paid or payable, if the terms of the contract of employment, express or implied, were fulfilled. On the other hand, the view of the High Court was that this remuneration was paid and became payable, if the terms of the contract of employment, express or implied. were fulfilled. This decision was given by the High Court after holding that, on an interpretation of the Scheme, the right of the employees to receive the Inam had become an implied term of the contract of....
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....Inam was notified, it became impossible for the employee to achieve the minimum target fixed, there was no liability_on the appellant to pay the Inam. Such exemption from payment of the Inam on grounds for which the employees could not be blamed and possibly for which the appellant itself might be responsible clearly shows that the payment of this Inam was not enforceable as one of the terms of the contract of employment, whether implied or express. The appellant had also laid down that, if any deterioration of workmanship was noticed on the part of the employees in order to achieve the targets prescribed for earning the Inam, the Scheme could be abandoned forthwith. It was also made clear to the workmen in the Scheme that this payment of reward was in no way connected with or part of wages. It was on these conditions that the employees were receiving the Inam. Thus, though there was a payment to the employees and since that payment depended on their achieving certain targets, it has to be held to be remuneration, this payment of Inam cannot be held to have become a term of the contract of employment. The High Court, in arriving at the contrary decision, referred to the Explanatio....
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....g the period of lock- out, or during the period of legal strike, would be wages, Inam paid under that scheme must also be deemed to be wages. The second reason which led the High Court to hold against the appellant was that, according to that Court, the Scheme contained an offer by the employer for payments to the employees for service rendered by them, and that offer was accepted by the employees impliedly by having worked on the terms of the Notice and having received payments on that basis. The mere fact that a reward for good work offered by the employer is accepted by the employee after he has successfully satisfied the requirement laid down by the employer for earning reward cannot mean that this payment becomes a part of contract of employment. In fact, in this case, there was no question of offer by the appellant and acceptance by the employees as a condition of their service. The employees were already working in accordance with the terms of their contract of employment when the employer decided 'to make this extra payment if the employees did successfully what they were already expected to do under that contract. It cannot, therefore, be held that this payment of Inam....