A. M. Allison vs B. L. Sen

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: supreme-court

Case Number: Civil Appeals Nos. 279 and 280 of 1955

Decision Date: 21 December 1956

Coram: Natwarlal H. Bhagwati, Bhuvneshwar P. Sinha, S.K. Das

In this case the Supreme Court of India rendered its judgment on 21 December 1956. The opinion was authored by Justice Natwarlal H. Bhagwati, and the bench was composed of Justice Natwarlal H. Bhagwati together with Justices Bhuvneshwar P. Sinha and S. K. Das. The petition was filed by A. M. Allison and the respondent was B. L. Sen, with the appeal connected to the same parties. The matter is reported in the 1957 volume of the All India Reporter at page 227 and in the Supreme Court Reports at page 359. The substantive statutory framework involved the Minimum Wages Act, 1948 (XI of 1948), specifically sections 3, 5(2) and 20, as well as the constitutional provision of Article 226. The headnote of the judgment recorded that male labourers on the tea estates were originally paid a basic wage of eight annas per day for a prescribed workload of plucking sixteen seers of green tea leaves, while female labourers received six annas for a workload of twelve seers. If a labourer harvested a larger quantity, the employer paid an extra rate of six paise per seer for the excess above the basic workload. On 11 March 1952 the Government of Assam issued a notification under section 3 read with sub‑section (2) of section 5, raising the basic wages to twelve annas for male workers and eleven annas for female workers, while retaining the same basic workload. After this increase, the management refused to pay any extra wages at the rate of six paise per seer unless the total harvest exceeded twenty‑four seers for males and twenty‑two seers for females. The Court held that the sole purpose of the government’s notification was to raise the basic wages while keeping the basic task unchanged, and therefore any work performed beyond the prescribed workload continued to attract the additional six‑paise per seer rate. The Court then posed the question whether a claim for such extra wages fell within the ambit of a claim for wages less than the minimum rates under section 20(2) of the Act. It further noted that a writ of certiorari cannot be granted as a matter of course; the High Court may refuse the writ if it finds no failure of justice, and the Supreme Court will not disturb the High Court’s discretion unless the justice of the case so requires.

The appellate proceedings were instituted in the civil appellate jurisdiction of the Supreme Court under Civil Appeals Nos. 279 and 280 of 1955. Both appeals arose from the judgment and order dated 7 July 1953 issued by the Assam High Court in Civil Rules Nos. 147 and 148 of 1952. The appellants were represented by senior counsel, namely C. K. Dophtary, who then held the office of Solicitor‑General of India, together with counsel P. K. Goswami, S. N. Mukherji and B. N. Ghosh, who appeared on behalf of the appellants in each appeal. For respondent No. 2 in Civil Appeal No. 280 of 1956, the representation was undertaken by counsel Purshottam Tricumdas and Naunit Lal. This description records the parties’ legal representation and the procedural posture of the appeals before the Court.

Naunit Lal appeared on behalf of respondent No I in both appeals. The judgment was delivered on 21 December 1956 by Justice Bhagwati. The two appeals, each supported by a certificate under article 133(1)(c) of the Constitution, challenged a decision of the High Court of Judicature at Assam. The High Court had dismissed the appellants’ petition filed under article 226 of the Constitution, a petition that contested the orders issued by the first respondent, Shri B L Sen, Deputy Commissioner of Sibsagar. The orders of Shri Sen had allowed applications filed on behalf of labourers employed in the Teok Tea Estate and the Dalim Tea Estate under section 20 of the Minimum Wages Act, 1948 (Act XI of 1948), hereinafter referred to as “the Act.”

On 11 March 1952 the Government of Assam, exercising the authority conferred by section 3 read with sub‑section (2) of section 5 of the Act, issued notification No GLR 352/51/56. The notification stated that, in the exercise of the powers of section 3 together with sub‑section (2) of section 5, the Governor of Assam, having considered the advice of the committee appointed under clause (a) of sub‑section (1) of section 5, was pleased to fix minimum wages effective from 30 March 1952. The minimum wages were comprised of basic wages and a dearness allowance in accordance with clause (1) of sub‑section 1 of section 4 of the Act. The rates applicable to employees engaged in tea plantations in the various districts of Assam were set out in an annexed schedule. The notification expressly clarified that the rates were exclusive of any concessions that workers might enjoy in respect of foodstuffs, other essential commodities and other amenities, which would continue unaffected. It further provided that the existing tasks and hours of work “may” continue until further orders.

The schedule listed the ordinary unskilled‑labour rates. For adult male workers, aged sixteen years and above, the basic wage was fixed at Rs 12 per day and the dearness allowance at Rs 6 per day, making a total of Rs 18 per day. For adult female workers, also aged sixteen years and above, the basic wage was fixed at Rs 11 per day with a dearness allowance of Rs 5 per day, resulting in a total of Rs 16 per day. The schedule also included rates for rest‑day wages and other classifications, but the essential point was the differentiation of rates by gender and age.

Subsequently, by notification No GLR 44/51 dated 16 April 1952, the Government introduced the Minimum Wages Rules. Among other provisions, Rule 24 defined the number of hours constituting a normal working day. It provided that an adult employee should work nine hours per day, subject to a maximum of forty‑eight hours in a week. Later, by notification No GLR 352/51 dated 12 May 1952, the Government clarified the language of the earlier March 11 notification. It explained that the word “may” appearing in clause (2) of that notification was to be read as having the force of “shall.” Consequently, the last sentence of clause (2) was amended to read: “The existing tasks and hours of work shall continue until further orders.” Prior to the fixation of the minimum wages consisting of the basic wages and dearness allowance specified above, the labourers engaged in plucking tea leaves in these estates were paid basic wages of Rs 8 per day for adult male workers who plucked sixteen seers of green leaves and Rs 6 per day for adult female workers who plucked twelve seers of green leaves. This payment structure formed the factual backdrop against which the present appeals were framed.

In the matter before the Court, the basic wages were fixed at eight rupees per day for male labourers who plucked sixteen seers of green tea leaves and at six rupees per day for female labourers who plucked twelve seers of green tea leaves. These quantities of leaves constituted the workload or task on which the basic wages of eight rupees and six rupees respectively were paid, apart from the dearness allowance that was paid in addition to the basic wages. If a labourer harvested a quantity of green leaves exceeding the standard sixteen seers for a male or twelve seers for a female, the labourer was entitled to additional, or “ticca,” wages at the rate of six paise per seer in excess of the respective standard quantities. It is noteworthy that the calculation of the basic wages on this basis also resulted in an effective rate of six paise per seer of green leaves plucked by the labourers.

After the government introduced the minimum‑wages notification, the managers of the tea estates continued to pay the labourers at the rate of six paise per seer of green leaves plucked. However, because the notification fixed the minimum basic wages at twelve rupees per day for male labourers and eleven rupees per day for female labourers, the managers refused to make any extra payment at six paise per seer unless the labourer’s plucking exceeded twenty‑four seers for males and twenty‑two seers for females. In effect, the managers maintained their earlier practice of paying six paise per seer regardless of the higher minimum basic wages.

The labourers argued that at the date the notification came into force, the workload remained sixteen seers for male labourers and twelve seers for female labourers. Accordingly, they claimed entitlement to the extra six paise per seer for any leaves plucked above those quantities. The labourers pointed out that, under the new minimum‑wage rates, they suffered a shortfall of four rupees per day in the case of male labourers and fifty‑one paise per day in the case of female labourers. They therefore sought an order that the estate managers should pay the basic wages of twelve rupees per day for males and eleven rupees per day for females for the established workload of sixteen and twelve seers respectively, and also pay extra wages at six paise per seer for any leaves harvested beyond those amounts.

These claims formed the basis of applications filed on behalf of the labourers before the Deputy Commissioner of Sibsagar, invoking section 20(2) of the Minimum Wages Act. The applications sought directions under section 20(3) directing the estate managers to pay the difference between the government‑fixed minimum wages and the actual wages that had been paid to the labourers since the notification took effect on 30 March 1952. The estate managers contested the applications on two principal grounds: first, that the applications were not maintainable under section 20 of the Act; and second, that there was no fixed workload or task for plucking that could be used to determine daily basic wages prior to the introduction of the minimum‑wages notification.

The managers contended that the applications were not maintainable under section 20 of the Act and that, prior to the introduction of the minimum wages, there was no fixed workload or task for plucking that could serve as a basis for daily basic wages. The Deputy Commissioner of Sibsagar, who was the authority designated under the Act to consider claims of payment of less than the prescribed minimum wages, entertained the applications, recorded the evidence and heard the arguments presented by both sides. In regard to the first objection, the Deputy Commissioner held that, assuming the version of the applicants to be correct, there existed a clear case of payment of wages below the minimum fixed by the Government, and consequently the applications were maintainable under section 20 of the Act. Concerning the second objection, after evaluating the evidence before him, he concluded that a workload of sixteen seers for male labourers and twelve seers for female labourers had been the basis for the daily basic wages of eight rupees for males and six rupees for females that were earned before the minimum‑wage notification was issued. He found that this workload formed the foundation for fixing the minimum wages, which included basic wages of twelve rupees per day for male labourers and eleven rupees per day for female labourers. Accordingly, the labourers were entitled to extra payment for green leaves plucked beyond sixteen seers for males and twelve seers for females at a rate of six paisa per seer. The Deputy Commissioner therefore ordered that the estate managers must pay the plucking labourers the minimum basic wages of twelve rupees per day to male workers for sixteen seers of green leaves and eleven rupees per day to female workers for twelve seers, together with the additional payment of six paisa per seer for any green leaves harvested in excess of those quantities.

Following the Deputy Commissioner’s order, the estate managers filed applications under article 226 of the Constitution before the High Court of Judicature in Assam, raising the same contentions that had been rejected by the Deputy Commissioner. The High Court dismissed those applications and granted the certificates of appeal under article 133(1)(c), bringing the present appeals before this Court. It was initially urged that the notification dated 11 March 1952 fixed only a “minimum time rate” and nothing more. Under section 3(2) of the Act, the Government was empowered to fix (a) a minimum rate of wages for time work, known as a minimum time rate, (b) a minimum rate of wages for piece work, known as a minimum piece rate, or (c) a minimum rate to be applied to employees engaged in piece work in order to secure for them a minimum rate of wages on a time‑work basis, referred to as a guaranteed time rate.

The Court noted that the Government had exercised its authority under section 3 (2) (a) to establish a “minimum time rate”, meaning that the labourers were to receive the basic wages listed in the Schedule regardless of how many green leaves they actually harvested. If this view were correct, the workers would not be entitled to any additional remuneration for picking quantities of leaves exceeding the alleged daily workload of sixteen seers for male workers and twelve seers for female workers at the time the notification was issued. Accordingly, the appellants contended that before the fixation of the minimum wages there existed no prescribed workload or task for the tea‑leaf pickers. The Court found this contention untenable. Both the Deputy Commissioner of Sibsagar and the High Court had recorded as a matter of fact that, prior to the fixing of the minimum wages, a basic workload of sixteen seers for male labourers and twelve seers for female labourers was in operation. This fact was established by the testimony of the Hazira Moharers of the estates and was acknowledged by the Government itself, which in the notification stated that “the existing tasks and hours of work shall continue until further orders.” The Court observed that if the minimum basic wages had been fixed without reference to any existing workload and were merely a “minimum time rate” as alleged by the appellants, there would have been no necessity to mention the continuation of the workload in the notification.

The Court further explained that the explicit direction that the existing workload would persist until further orders demonstrated that the basic wages specified in the Schedule were linked to that workload. Accordingly, the rates of twelve rupees for male labourers and eleven rupees for female labourers were fixed in respect of the established workload of sixteen seers of tea leaves for males and twelve seers for females. The appellants argued that maintaining the existing workload was intended solely to prevent employers from increasing the workload to offset the rise in basic wages, and that the workload had no relationship to the fixed wages. The Court rejected this argument, emphasizing that at the date of the notification a definite workload existed and formed the basis for calculating payments. The basic wages were computed at a rate of six paisa per seer of tea leaves harvested, resulting in payments of eight rupees for male labourers and six rupees for female labourers for the workload of sixteen and twelve seers respectively.

In this case, the Court observed that the sole purpose of the Government in issuing the notification was to raise the basic daily wages from eight annas for male labourers and six annas for female labourers to twelve annas and two annas respectively, while keeping the same basic work‑load or task that had been assigned to the male and female workers. The Court explained that, if the Government had not intended to link the increased basic wages to the existing work‑load or task, and if the situation had remained that the workers were to be paid on the basis of six pies per seer of green tea leaves plucked, then there would be no rational reason for raising the basic wages from eight annas to twelve annas for male workers and from six annas to two annas for female workers, as the notification attempted to do. Accepting the appellants’ argument would imply that the Government sought to confer no benefit on the tea‑estate workers who plucked leaves, an intention that the Court found hard to attribute to the Government. Consequently, the Court held that the notification did not merely fix a “minimum time rate” that ignored the existing workload, but rather established a minimum wage that, although expressed as a time‑based rate, was necessarily tied to the workload then performed by the labourers. Accordingly, any work performed beyond the established workload of sixteen seers for male labourers and twelve seers for female labourers had to be compensated according to the prevailing practice—whether based on agreement, customary ticca, or other usage—at the rate of six pies per additional seer. The Court affirmed that the findings of the Deputy Commissioner of Sibsagar and the High Court on this point were correct and could not be challenged. The appellants, however, maintained that the matter did not involve payment of less than the minimum rates of wages and that any claims by the workers fell outside section 20 of the Act. The Court noted that the tea estates had never refused to pay the basic wages, which were in fact being paid at twelve annas per day to male labourers and two annas per day to female labourers. The workers’ grievance, if any, concerned the non‑payment of extra wages calculated on the basis of six pies per seer for tea leaves plucked beyond the basic workload of sixteen seers for males and twelve seers for females. Thus, the workers’ claim amounted to a demand for additional wages over and above the basic daily rates of twelve annas and two annas that were already being paid.

In this case the Court noted that the dispute presented by the parties was not a claim that arose from the payment of wages below the minimum rates as contemplated by section 20(1) of the Act; therefore the Deputy Commissioner of Sibsagar did not possess the jurisdiction to entertain the application. Section 20, to the extent that it is relevant for the present discussion, provides that the appropriate Government may, by notification in the official Gazette, appoint any Commissioner for Workmen’s Compensation or any other officer who has experience as a Judge of a Civil Court or as a stipendiary Magistrate to constitute an Authority for a specified area. That Authority is empowered to hear and determine, for that area, all claims that arise out of the payment of less than the minimum rates of wages to employees employed or paid in that area. Where an employee receives less than the minimum rates fixed for his class of work under the Act, the employee himself, or a legal practitioner, a registered trade‑union official authorised in writing, an Inspector, or any person authorised by the Authority under subsection (1), may apply to the Authority for a direction under subsection (3). When an application under subsection (2) is taken up, the Authority must hear the applicant and the employer or afford them an opportunity to be heard, and after any further enquiry it deems necessary, may, without prejudice to any other penalty that may be imposed on the employer by the Act, order the employer to pay the employee the difference between the minimum wages payable and the amount actually paid. The Authority may also award compensation, in its discretion, not exceeding ten times the amount of that shortfall, and it may direct that such compensation be paid even where the excess has already been paid by the employer before the application is disposed of. Every direction issued by the Authority under this section is final. It was argued before the Court that the Authority created by section 20(1) is vested with the power to hear and decide claims arising from the payment of wages below the minimum rates, to hear both the applicant and the employer, and, after any necessary enquiry, to issue directions under section 20(3) that are final and not subject to appeal or revision by any higher body. The Court observed, however, that such sweeping powers could not be intended for cases that involve complex questions of law or fact. The powers are meant to be exercised only where the quantum of minimum wages fixed by the relevant notification can be ascertained by the Authority on a plain reading of its terms. Only in such circumstances would the Authority possess jurisdiction to entertain the claim and to issue the final direction contemplated by the statute. In the instant case the Court therefore concluded that the matter did not satisfy that criterion.

In the matters that came before the Court, the issues were not only factually complex, requiring the authority to record substantial evidence, but they also required interpretation of a notification whose wording was far from clear. The tasks that were to remain in force until further orders were not at all obvious, and if the authority appointed under section 20(1) of the Act had to determine them, the process would necessarily involve, in cases of dispute, the collection of considerable evidence and a subsequent adjudication after hearing the arguments presented by both sides.

A further difficulty arose in these cases because each party advanced a rival claim that could be argued with equal force. The appellants maintained that, since the date of the notification, they had consistently paid the labourers a basic wage of twelve rupees per day for male workers and eleven rupees per day for female workers. They pointed out that no instance had been cited by the respondents showing any payment of less than the minimum basic wages fixed by the Government. The labourers, according to the appellants, sought additional wages only for plucking green leaves beyond the basic workload of sixteen seers for males and twelve seers for females. The appellants argued that such a claim for extra wages did not constitute a claim for payment of less than the minimum rate of wages.

Conversely, the respondents contended that the basic wages of twelve rupees per day for male workers and eleven rupees per day for female workers, as fixed in the notification, were linked to the existing workload of plucking sixteen seers of green leaves for males and twelve seers for females. They claimed that if a worker was entitled to those basic wages only on the condition of completing that quantity of work, then the refusal of the tea‑estate managers to pay any additional wages—calculated at six paise per extra seer unless the worker plucked twenty‑four seers for males or twenty‑two seers for females—effectively amounted to non‑payment of the minimum basic wages prescribed in the notification.

The Court expressed that it did not intend to decide the question of jurisdiction in these cases by adding to the determination already made by the Deputy Commissioner of Sibsagar and by the High Court’s adjudication of the principal disputes. Even if there were any imperfections in the orders of the Deputy Commissioner on the ground of lack of jurisdiction, the Court considered that, given the matters had been pending from September 1952 until the end of 1956, any further interference at this stage would not serve any useful purpose.

In this case, the Court observed that both the Deputy Commissioner of Sibsagar and the High Court of Assam had reached the same conclusion, a conclusion which the Court expressly endorsed. The conclusion was that the labourers were entitled to receive basic wages of rupees twelve per day for male labourers and rupees eleven per day for female labourers when they performed the task of plucking sixteen seers of green leaves for men and twelve seers for women. In addition, the labourers were entitled to receive extra wages for each seer of green leaves they plucked beyond those quantities, the extra amount being calculated at six rupees per seer. The Court further noted several special reasons why it should not interfere with the orders of the Deputy Commissioner, Sibsagar, in these appeals. Firstly, the appeals did not arise directly from the orders of the Deputy Commissioner; rather, they were originally subject to proceedings under article two hundred twenty‑six of the Constitution in the High Court of Assam. Secondly, proceedings by way of certiorari were not appropriate, as explained in the referenced legal commentary (Vide Halsbury’s Laws of England, Hailsham Edition, Vol. 9, para 1480 and 1481, pp. 877‑878). The High Court possessed the power to refuse the writs if it was satisfied that there was no failure of justice, and in the present appeals, which were directed against the High Court’s orders in the article‑226 applications, the Supreme Court could also refuse to interfere unless it was convinced that the justice of the case required such interference. The Court found that it was not so convinced. Considering that the merits of the disputes had been concurrently decided in favour of the respondents both by the Deputy Commissioner, Sibsagar, and by the High Court, the Court decided to decline any further interference. Consequently, the Court held that the appeals were liable to be dismissed. Accordingly, the Court dismissed the appeals and, taking into account the particular circumstances previously mentioned, ordered that each party should bear and pay its own costs of the appeals.