TaxTMI 
TaxTMI 
2024 (1) TMI 664
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.... Award dated 13.08.2014 rejecting the Reference. Reference related to the Petitioner's claim for seeking subsistence allowance which was denied by the Respondent - Company on the ground that the suspended employee did not attend the factory premises to mark his attendance at the factory gate in the muster / register provided for the purpose during his suspension. Award has held that denial of subsistence allowance is not contrary to law and justified, since the employee did not attend the factory everyday and sign the muster / register provided therefor. 3. Cause of the employee is espoused by the recognized Union in the Respondent - Company. According to Petitioner, it is not a requirement under the law requiring and/or to call upon a suspended employee to mark his physical attendance and sign the muster everyday at the factory gate as a pre-requisite for being paid subsistence allowance. In the present case, the employee has not attended the factory each day and signed the muster due to which he has been denied subsistence allowance. This is upheld by the Labour Court. 4. Briefly stated, the facts necessary for the adjudication of the present case are as under:- 4.1. The....
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....in February, 2007. Demand was raised by the Petitioner - Union for subsistence allowance to be paid which the Respondent - Company refused. Between October 2007 and March 2008 conciliation proceedings were held resulting in a failure. 4.8. On 11.06.2008, order of Reference was made as under:- "WHEREAS, the U.T. Administration of Daman & Diu is of the opinion that an Industrial Dispute exits between the Management of M/s.Hindustan Unilever Limited, Daman Detergents Factory, Survey No.34, Silver Industrial Estate, Village Bhimpore, Daman and its employee Shri Natubhai Mohanlal Patel in respect of the matter specified in the Schedule annexed hereto (herein after referred to as the 'said dispute')." 4.9. On 28.11.2008, services of Mr. Natubhai Patel were terminated. The dispute that is referred for adjudication before the Reference Court in I.D.R. No.7 of 2008 pertains to the issue of subsistence allowance. The Reference Court framed the following issues and answered them after adjudication:- Sr. No. Points Finding 1. Whether the Reference is vague and incapable of being adjudication by this court? .....In the Negative. 2. Whether the First P....
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....n Nisha Khatoon Vs. State of Bihar and Ors. [AIR 2002 SC 2959]. She would submit that the only requirement found under clause 14(4)(e) of the Central Rules, 1946 is that the workman should not take up any employment during the period of suspension. She would submit that there is no requirement in this regard for any certificate to be furnished and even in matters where there is such a rule for furnishing of a certificate, the Supreme Court has held that the same must be actually called for by the employer. She has drawn my attention to paragraph Nos.6 to 12 of the above decision which read thus:- "6. The Registrar, Co-operative Society by Memo No. 7252 dated 30th October, 1999 rejected the claim for subsistence allowance. The appellant then filed C.W.J.C. No. 9095 of 2000 challenging the order of the Registrar. The High Court by an order dated 26th April, 2001 dismissed the writ petition. The appellant then filed a Letters Patent Appeal. This was dismissed by the impugned Order dated 27th July, 2001 on the ground that the appellant's husband was absent for 23 years and he was present for only one day. In our view, for reasons set out hereafter, the decision of the High....
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....aged in any other employment, business, profession or vocation. The appellant's husband having died, he could not have furnished such a certificate. At no stage have the respondents asked the appellant to give such a certificate. Thus the grant of subsistence allowance cannot be denied on the ground that such a certificate is not given. 10. This view of ours is supported by an authority of this Court in the case of Jagdamba Prasad Shukla v. State of U.P. [(2000) 7 SCC 90]. In this case, on identical facts, it has been held that if the State requires a certificate they should ask for it. It has been held that without asking for such a certificate the State cannot reject a claim for subsistence allowance. 11. In the case of Capt. M. Paul Anthony v. Bharat Gold Mines Ltd. reported in (1999) 3 SCC 679 this Court has held that a suspended employee is entitled to subsistence allowance as a relationship of employer-employee subsists. 12. For the above reasons, we hold that the appellant is entitled to receive subsistence allowance, which should have been paid to her husband. As the only ground for not paying the subsistence allowance is that a certificate re....
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....on 9 October 1996. On 10 October 1996, a chargesheet was served on the petitioners indicating that a regular departmental enquiry would be conducted against them. The enquiry proceedings commenced on 12 March 1997. The suspension orders were served on the petitioners on 25 October 1996. Departmental enquiry, according to the respondent-Management, concluded in March 1999. The report was received by the management on 9 November 2000. The enquiry officer has found the petitioners guilty of the charges. This report has not been served on the petitioners till today. Furthermore, no action has been taken on the enquiry report by the disciplinary authority. During the suspension period, the petitioners were entitled to be paid subsistence allowance at the rate of 50 per cent of the wages for the first three months, and at the rate of 75 per cent of the wages for the rest of the period of the suspension. The management has not paid any amount to the petitioners. Consequently, petitioners were compelled to file an application in the Labour Court under S. 33C(2) of the Industrial Disputes Act for computing the amount due on account of subsistence allowance from October, 1996 to December 199....
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....adjudicate upon the fairness or reasonableness of the provisions of the Standing Orders. Upon certification, the Standing Orders bind the management and the workman. Nevertheless the Model Standing Order or the Certified Standing Orders remain law made under the Act. In the present case, the claim of the petitioners is disputed by the respondent-management on the ground that the petitioners have failed to comply with the proviso to Standing Orders 30(d) and (g). The provisions with regard to the grant of subsistence allowance during the period of suspension is made in S. 10A of the Act. For facility of reference S. 10A of the Act and Standing Orders 30(d) and (g) are reproduced as under:- "10A. Payment of subsistence allowance.- (1) Where any workman is suspended by the employer pending investigation or enquiry into complaints or charges of misconduct against him, the employer shall pay to such workman subsistence allowance- (a) at the rate of fifty per cent of the wages which the workman was entitled to immediately preceding the date of such suspension, for the first ninety days of suspension; and (b) at the rate of seventy five per cent of such wages fo....
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.... the date of suspension for the first 90 days of suspension. Thereafter, the workman is entitled to subsistence allowance at the rate of 75 per cent of such wages for the remaining period of suspension. The increased 75 per cent of the suspension allowance has to be paid to the workman, if the delay in completion of disciplinary proceedings is not directly attributable to the conduct of the workman. Nothing has been brought on record in the present proceedings to establish that the petitioners have in any manner been responsible for delay in the completion of disciplinary proceedings. Under the Act, there is no other condition which is to be satisfied by the workman for receipt of the suspension allowance. This right is, however, sought to be cut down under Standing Orders 30(d) and 30(g) and the proviso thereto. In my considered opinion, in the face of S. 10A of the Act, the condition laid down in aforesaid Standing Order 30(d) with regard to the attendance cannot be relied upon by the management for denying the benefit of subsistence allowance to the petitioners. A benefit granted to the workman under the Act cannot be permitted to be curtailed by the Model Standing Orders or the....
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.... that was made by the appellant to the first respondent was in accord not only with the provisions of the Certified Standing Orders applicable to their industrial establishment but also with those of S. 10A. It was urged by Smt. D'Souza learned counsel for the first respondent, that the first respondent was entitled to subsistence allowance as provided by the Model Standing Orders by reasons of Sub-sec. (3) of S. 10A because the Model Standing Order were "other law" within the meaning of Sub-sec. (3). We find the argument difficult to accept. The Model Standing Order, as also Certified Standing Orders, are law no doubt, but they are law made under the provisions of the Act. They are not provisions "under any other law". In our view, therefore, the provisions of S. 10A supervene in relation to the payment of subsistence of the Model Standing Orders". 13. A perusal of the aforesaid ratio clearly shows that Model Standing Orders as also the Certified Standing Orders, are law made under the provisions of the Act. Therefore, the provisions of S. 10A supervene in relation to the payment of subsistence allowance over the provisions of the Model Standing Orders/Certified Stand....
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..... Orrissa Air Products Ltd. [2008 II LLJ 800 (Ori)] wherein the the Division Bench of the Orissa High Court in a similarly placed case held that as per the provisions of Section 10(A) of the said Act read with clause 14(4)(b) and (e) of the Central Rules, 1946 there is no provision or requirement for marking of attendance at the factory gate during the period of suspension. Paragraph Nos.8 to 10 of this decision are relevant in this regard and reproduced below:- "8. Despite repeated query from this Court, Learned Counsel for the Company failed to show that there is any requirement under any Rules that a suspended workman has to report for duty everyday or to the sign the attendance register and to receive direction and communication from the Company during the period of suspension. In the absence of any such Rule, it is difficult for this Court to sustain the stipulation to that effect in the suspension order. Learned Counsel also referred to Section 10A of the Industrial Employment (Standing Order) Act, 1946 (hereinafter called the 'said Act'). Section 10A of the Act reads as follows:- "10A. Payment of subsistence allowance. (1) Where any workmen is susp....
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.... suspension is not a bounty but a right and the employee is entitled to be paid the subsistence allowance. Paragraph Nos.7 and 8 of the decision are relevant and reproduced herein under:- "7. Reverting now to the other reason which prevailed with the High Court, namely, the appellant having not furnished a certificate stating that he is not engaged in any other employment, business, profession or vocation and having thus not complied with Rule 53(2) of the Financial Hand Book, it may be noticed that at no stage, the appellant was told that he had to furnish such a certificate, and that he could not be paid subsistence allowance without it. It was not the case of the respondents that in response to the appellant's request for payment of subsistence allowance, he was asked to furnish such a certificate and since he did not furnish it, the amount of subsistence allowance was not paid to him. Therefore, the second reason for rejecting the appellant's contention for nonpayment of subsistence allowance also does not deserve to be sustained. 8. The payment of subsistence allowance, in accordance with the Rules, to an employee under suspension is not a bounty. It ....
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....has returned a finding in paragraph No.20 of the Award that as per provisions of clause 4(e) of Schedule - I of the Model Standing Orders (Central), the workman has to satisfy that he was not in employment during the suspension period to claim subsistence allowance. Taking this further, she would submit that as a natural corollary, the condition of marking attendance in the suspension order is therefore just, fair, bonafide and legal as held by the Labour Court. She would submit that the Labour Court has held that it can be therefore said to be in consonance with the provisions of Section 10(A) of the said Act. She would submit that the Labour Court held that non-payment of subsistence allowance in this case is not against any provision of law since it found that the condition of marking attendance at the factory gate stipulated by the Respondent - Company is not unfair and against the law. 6.1. She would submit that Respondent - Company is permitted under the statute to stipulate a just, fair and bonafide condition in consonance with the prevailing law for entitlement of subsistence allowance. 6.2. In support of her above submissions, she would submit that the Model Standing....
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....bmit that the stipulation is reasonable and within legal bounds and the same is evident from the fact that various legislations have recognized such conditions by incorporating the same in the Rules / Regulations for eg. Rule 33(4) of the Maharashtra Employees of Private Schools (Conditions of Service) Rules, 1981 ("MEPS Rules") which provides that an employee under suspension shall not leave the head-quarters during the period of suspension without the prior approval of the CEO or the President, as the case may be, and if the employee fails to abide by the aforesaid condition, he would not be entitled to claim the subsistence allowance. Similarly, Uttar Pradesh State Textile Corporation Conduct, Control and Disciplinary Rules, 1992 ("Disciplinary Rules") provide that subsistence allowance would be payable only when the employee, if required, presents himself every day at the place of work or such other place as mentioned in the order. Further, the employee, under suspension would have to furnish a certificate that he is not engaged in other employment, business, profession or vocation for entitlement of subsistence allowance. In support thereof, she has relied on the decision of t....
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.... the factory gate for entitlement to subsistence allowance is fair, reasonable and bonafide and in furtherance to serve the purpose / intent of the law i.e., to ensure that the concerned workman should not be gainfully employed during the suspension period. 6.8. The next submission is that Mr. Natubhai Patel by his own conduct is deemed to have accepted the condition stipulated in the suspension notice and therefore in the absence of challenge to the said notice is now estopped from raising any grievance with respect to the same. In this regard, she would submit that no reasons are set out by the Petitioner - Union for not marking the attendance and on the contrary, Mr. Natubhai Patel accepted the condition and marked attendance from April 2004 till April 2005 and received payment of subsistence allowance in lieu thereof. She would submit that Mr. Natubhai Patel raised grievance in respect of non-payment only before the Enquiry Officer for the first time on the ground that the condition stipulated in the suspension notice was unlawful, however, when the matter was placed during reference before Conciliation Officer as well as the Labour Court, there was no challenge to the suspe....
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....ntion to the statement of claim of Mr. Natubhai Patel which is at Exhibit - H Page No. 33 onward in the Writ Petition and would submit that bare perusal of the statement of claim of the employee would show that the employee has made no averment regarding the fact of him not being gainfully employed during his suspension; that the only fact that is highlighted is that the Petitioner was opposed to the idea of marking attendance everyday at the gate under the pretext that the said condition was illegal. She would next submit that the same is so deposed in his affidavit of evidence. 6.13. She would submit that, no such demand regarding withdrawal or setting aside of this condition for subsistence allowance was raised by the Petitioner / employee. She submits that it was for the first time in the affidavit of evidence that Mr. Natubhai Patel deposed that he had declared before the Enquiry Officer and the Respondent - Company that he was not gainfully employed during the period of suspension and further Mr. Natubhai Patel also went ahead to depose that an affidavit regarding the same was filed before the Conciliation Officer, however, the proof of such declaration / affidavit was nei....
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....e was not gainfully employed and the initial burden is on him. She would submit that though it was for the employer to raise the plea about the employee not being gainfully employed during the suspension period, having regard to the provisions of Section 106 of the Indian Evidence Act, 1872, such a plea if raised by the workman, then the burden of proof would be on the workman as it is a negative burden and only if the same is discharged by the workman, the onus of proof would shift onto the employer. 6.17. Finally, she would submit that the requirement of workman signing the attendance register at the factory gate during the period of suspension is a customary practice followed by the Company for all its workmen / employees and the Respondent - Company in its affidavit of evidence filed through its witness Ms. Tanvi Shah has deposed that the requirement of marking attendance every day at the gate was followed for all suspended workmen of the Respondent - Company and has been a prevalent practice for many years and hence it has become a rule, custom and usage in the Respondent - Company and Mr. Natubhai Patel could not be absolved from it; Mr. Natubhai Patel himself has admitted....
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....oyer shall pay to such workman subsistence allowance- (a) at the rate of fifty per cent of the wages which workman was entitled to immediately preceding the date of such suspension, for the first ninety days of suspension; and (b) at the rate of seventy-five per cent of such wages for the remaining period of suspension if the delay in the completion of disciplinary proceedings against such workman is not directly attributable to the conduct of such workman. (2) If any dispute arises regarding the subsistence allowance payable to a workman under sub-section (1), the workman or the employer concerned may refer the dispute to the Labour Court, constituted under the Industrial Disputes Act, 1947 (14 of 1947), within the local limits of whose jurisdiction the industrial establishment wherein such workman is employed is situate and the Labour Court to which the dispute is so referred shall, after giving the parties an opportunity of being heard, decide the dispute and such decision shall be final and binding on the parties. (3) Notwithstanding anything contained in the foregoing provisions of this section, where provisions relating to payment of subsis....
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....nsion. From reading Section 10(A) of the said Act, it appears that the provision is a beneficial enactment to take care of employees who are placed under suspension and they are required to be paid the prescribed 50% wages as contemplated for the period under suspension. In the present case, the Respondent - Company has argued that it is a long standing customary practice of the Respondent - Company to require marking of attendance at the factory gate because of which subsistence allowance is denied to Mr. Natubhai Patel. Therefore, the question before me is whether such a customary practice of requiring the employee to mark his attendance at the factory gate without the support of any rule, regulation, standing order or statutory enactment is maintainable in the face of the statutory provision of Section 10(A) of the said Act. I am afraid it is not. The Respondent - Company cannot lay down and insist on a customary practice followed by the Company to prevail upon the existing statutory provisions of law. The argument of the Respondent - Company is difficult to accept. A customary practice cannot be equated as a provision under any law or a provision under any other law and t....
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..... None of the judgments referred to and relied upon by the Respondent - Company have addressed the aforementioned legal issue of requiring marking of attendance everyday during the period of suspension. What is required under the law is for the suspended employee to inform the employer that he is not gainfully employed elsewhere and nothing more. Once the statutory provisions does not provide for requiring marking of attendance everyday such introduction of a stipulation as per customary practice is illegal in law, no matter what the concerned employer desire from introducing such a condition. In the present case, the said restrictive condition cannot be made a precondition to the extent of claiming that it was for ensuring that the employee was not gainfully employed during the period of suspension. Such an interpretation and argument deserves to be rejected and dismissed in the first instance itself. Such a stipulation is unreasonable and cannot be within the four corners of the statutory provisions. 14. In the written submissions submitted by the Respondent - Company it has been specifically submitted that such a requirement of signing the attendance register at the gate duri....