TaxTMI 
TaxTMI 
1980 (11) TMI 165
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....lting organisation and a service industry, and does not manufacture any product or carry on trade. Its work force consists of engineers and supervisors and different categories of workmen. Out of 665 employees at Bombay, the draftsmen and the administrative staff number 306. These workmen are members of the Tata Consultant Employees Union. They served a Charter of Demands in July, 1974, on the appellant, and as their demands were not accepted and conciliation proceedings proved fruitless, the State Government made a reference of the dispute under s. 10(1) (d), Industrial Tribunal, Maharashtra for adjudication. The Reference was numbered I. T. No. 292 of 1975. The Union filed a statement before the Tribunal claiming an upward revision of the wage scales and dearness allowance and an increase from fifteen years to twenty years in the span for earning annual increments. It was urged that the Efficiency Bar, as a feature of the wage scales, should be removed. The dearness allowance, it was claimed, should be granted on a slab system. The claim of the Union was resisted by the appellant, who maintained that the existing wage scales were fair and reasonable on a region-cum- industry b....
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....arate and independent division of Tata Sons Limited and had no "functional integrality" with the other divisions. Having regard to the net profits earned by the appellant from 1968 to 1977 it found that the acceptance of the demands of the Union would result in an increased burden of Rs. 7 crores, a burden which would dry up the appellant's resources and would be impossible for it to bear. The Union modified its demands but even the modified terms, according to the Tribunal, appeared to be on the high side inasmuch as the resulting total burden of Rs. 1.70 crores was much higher than the average profits could sustain. The particular character of the appellant, that it was a service industry and not a manufacturing concern, was taken into account and it was observed that unlike a manufacturing business there was little scope for diversification in the case of an engineering consultancy. Nonetheless, the Tribunal observed, there was every reason to expect that the appellant would be able to earn sound profits in the future, and the instability in its business activities occasioned by the turbulent political situation in Iran, would be, it was expected, compensated by ....
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....5-520-20- House-keeper/ 15-540. 660-EB-25-785.Caretaker. III Jr. Clerk-cum- Rs. 350-15-425-EB- Rs. 450-20-550-25- Typist/Jr. Steno 20-625-EB-25-725. 800-EB-30-950. Tel. Optr./Recep-tionist/Assist. Record Keeper/ Veh. Mechanic/ Jr. Librarian. IV Sr. Clerk/Steno/ Rs. 450-20-530-EB- Rs. 550-25-675-30- Record Keeper/ 30-860-EB-35-1000. 975-EB-40-1175. Tlx. Operator/ Xerox Operator V Office Asstt./ Rs. 590-30-740-EB- Rs. 690-35-865-40- Lib. Asstt./ 35-1020-EB-40-1300 1265-EB-45-1490. Cost. Assist./ Administrative Assist./Personnel Asstt./Comm. Asstt./ Canteen Asstt. VI Draughtsman/Site Rs. 380-30-620-40- Rs. 530-40-730-50- Supervisor/ 1020-EB-50-1320. 1230-EB-60-1530. Surveyor/(Diploma Holder). VII Junior Architect Rs. 760-40-1000-50- Rs. 860-50-1160-(Engineering 1300. -60-1700. Graduate) VIII Sr. Draughtsman Rs. 1000-50-1300- Rs. 1100-60-1340- (Diploma Holder) 60-1600-75-1750. 70-1690-80-2010. The Tribunal maintained the existing schemes of dearness allowance and house rent allowance, and observed that in view of the revised basic wages there would be a resultant increase in the dearness all....
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....INDUSTRIAL TRIBUNAL." In this appeal, the learned counsel for the appellant had covered a wide field, but in the end he states that the appellant is aggrieved by two matters only. One is the retrospectivity attached to the revised wage scales, and the other is the flat increase given to each employee of Rs. 150/- in the category of Draughtsmen and Rs. 100/- in other categories resulting from the order dated 22nd December, 1978. The workmen have filed an appeal by special leave, Civil Appeal No. 2300 of 1979, in which they have challenged the rejection by the Tribunal of their claim in respect of dearness allowance which, they contend, should be pegged to the cost of living index and should not be a fixed amount. Considering the appeal of Tata Consulting Engineers first, the contention of learned counsel for the appellant is that having regard to the financial capacity of the appellant the Tribunal erred in making the wage scales retrospective and, in any event, in ranging the retrospectivity back to 1st January, 1976. We have been taken through some of the material on the record in the attempt to support the contention, but after giving careful thought to the m....
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....hat should not have been included has been included or what should have been included has been omitted. It must be a mistake or error amenable to clerical correction only. It must not be a mistake or error which calls for rectification by modification of the conscious adjudication on the issues involved. Is the instant case one where the amendment made by the Tribunal in the original award can be said to correct a mere clerical mistake or error arising from an accidental slip or omission? To answer the question, it is necessary to examine the basis of the award and the intent which flows from that basis. The terms of reference in the State Government's order required the Tribunal to revise the scales of pay and dearness allowance, and there was no mention of giving any ad hoc increase in the basic pay of individual workman. It would do well to recall that the claim of the Union filed before the Tribunal also centered on the need to revise the wage scales. That was the main issue between the parties. It is to the task of revising the pay scales that the Tribunal addressed itself, and throughout the material part of the award it is that task which held its focussed attention. ....
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.... workmen. If, as the Tribunal has stated in the amendment order, the increase in paragraph 23 was intended to apply to each individual workmen, there is nothing in the body of the award to form the foundation on which the actual figures in the restructured pay scales can be made to rest. There will be no explanation why the initial start of the revised pay scales has been increased by Rs. 150/- in the case of the category of Draughtsmen and Rs. 100/- in the case of other categories. Considering the fitment of the workman in the revised scales, it was stated in the award that a workman found drawing a salary less than the beginning of the grade would be stepped up to the beginning of the grade and if his pay fell between two steps in the reclassified pay scales the basic pay was to be fixed at the step higher in the revised scale. Conspicuous by its absence is any reference to a flat increase in the pay of an individual workmen. Even when considering the range of permissible retrospectivity the Tribunal stated in the award: "In view of the revision of the wage scales, there would be consequent increase in the dearness allowance and the house rent allowance....
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....idual workmen of all categories, the additional load would total Rs. 4,97,772/-. Finally, on the basis that the individual Draughtsman would be given an increase of Rs. 75/- per month and the individual workmen of other categories Rs. 50/- per month, the additional load was calculated at Rs. 4,63,092/-. It will be noted that the statement, Exhibit C-51, was prepared on the basis of the employees' strength as in December, 1971. A similar statement was prepared on the basis of the employees' strength as in September, 1978. These statements cannot be regarded as evidence that the appellant was cognizant of the intention of the Tribunal to provide a flat increase to the pay of each workman. The statement afforded an indication merely of what the additional financial load would be if a flat increase was given to the individual workman on the alternative basis set forth therein. None of the alternatives was actually adopted by the Tribunal, because when the award was made the Tribunal proceeded instead to restructure the wage scales by the addition of Rs. 150/- in the case of the category of Draughtsmen and Rs. 100/- in the case of other catego....
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....ks Limited v. Its Workmen. Now, it is not a universal rule that the dearness allowance should in all cases be correlated with the cost of living index. The Tribunal, in the present case, considered the matter and found it sufficient and in accord with justice that the wage scales should be restructured with suitable increments provided therein. It noted that dearness allowance was being granted by the appellant at 10% of the salary subject to a minimum of Rs. 50/- and house rent allowance at 30% of the basic salary. Having regard to the not inconsiderable improvement in the level of the basic wage, it observed that there would be a consequent increase in the dearness allowance and house rent allowance. In view of the increase so secured, the Tribunal rejected the suggestion that a slab system should be introduced in the dearness allowance or that there should be any other modification of the principle on which dearness allowance was being presently granted. It declared that the cumulative effect of an improved wage structure together with dearness allowance operating on a slab system would throw an impossible burden of about Rs. 1 crore on the financial capacity of the ....
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....ndustrial Disputes (Bombay) Rules, 1957 seeking a correction of an error, which it was claimed, had crept into the Award. The application was as follows: "In the above reference your honour was pleased to pass an award on 20th December, 1978. In the said award, Your Honour has observed, at the end of Para 22, 'In view of the increase that is being allowed in the basic pay, I do not propose to revise the existing scheme of Dearness Allowance'. Further, it appears that the Tribunal intended to grant the increase of Rs. 150/- to each draughtsman and Rs. 100/- to all other workmen in their basic pay. However, this is not clearly mentioned anywhere in the award due to accidental slip or omission. The Union therefore prays the honourable Tribunal to clarify the position and correct the award accordingly". On this application, the Advocate for the employer company made the following endorsement: "Submitted to whatever this Hon'ble Tribunal desires to do". Thereafter the Tribunal made an order on the same day in the following terms: "There can be no doubt that a flat increase of Rs. 150/- to each of the employees in the cate....
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....es of the employees of an establishment would have full liberty to propose ad-hoc increase of salaries as part of the revision of wages. Nor can it be doubted that fitment into the revised pay scales is certainly a part of the revision of pay scales. This in our opinion is elementary and fundamental to the jurisdiction of the Industrial Tribunal in revising wage-scales. In the present case the Industrial Tribunal on a consideration of the material placed before it came to the conclusion that the company was in an undoubted position to bear the additional financial burden. At the end of paragraph 15 of the Award, the Tribunal stated: "But there can be no doubt that the company can very well bear the additional burden. The question is what should be the extent of such burden?" At the end of paragraph 18 of the award the Tribunal said: A" mere reading of Exhibit U-15 will immediately dispel the misgivings about the future of the present company. For some years to come this is likely to be one of the few Consulting Engineers who will be securing major contracts". Again in Paragraph 19 it was said: "I have no doubt that the present Company would be able to bear the additional burden ....
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....e as on 1st January, 1976, 2 increments. (iii) All other employees with more than one year's service shall be given one increment". Now, if, without any flat or ad hoc increase of salary, the workmen were to be fitted into the revised scales of pay, it would obviously result in serious anomalous situations. In the case of several senior employees, the revised scale would yield but a very small and almost a token increase in the size of the pay packet whereas the junior employees would get a large benefit. While workmen raising industrial disputes for revision of wage-scales are certainly minded about their future prospects in the matter of wages, they, surely would be more concerned with the immediate benefits according to them That was why the Industrial Tribunal thought that an all round flat increase of Rs. 150/- in the case of Draftsmen and Rs. 100/- in the case of other workmen was called for. It was clearly so intended by the Tribunal as is evident from the reference to "flat increase of Rs. 150/- in the category of Draftsmen and Rs. 100/- in the case of the other categories". Since there was to be a flat increase of Rs. 150/- and....