1. The petitioner Shalimar Paints Limited is a Company engaged in the business of the manufacture and sale of paints, colour, varnish and oils.
2. Prior to January, 1963, Messrs. Turner Morrison & Company were the Managing Agents of the petitioner. Under the terms of the Managing Agency Agreement, Turner Morrison & Company Limited was bound to provide and did provide office accommodation for the staff of the petitioner at premises Nos. 6, Lyons Range, Calcutta. After the termination of the Managing Agency Agreement with effect from the 1st January, 1963, Turner Morrison & Company Limited revoked the licence of the petitioner permitting them to occupy office accommodation at the said office. As a result thereof, the petitioner was compelled to vacate the said office accommodation on or about the 28th February, 1963. According to the petitioner, on the 1st March, 1963, it shifted its entire undertaking from 6, Lyons Range, Calcutta and moved its Head Office to Goabaria, Howrah, where it had been having its factory for a long time past. It shifted its Sales Division to 13, Gamac Street, Calcutta.
3. Thereupon, the workmen of the petitioner claimed that the petitioner had transferred the services of the workmen and thereby altered the conditions of their services without giving the requisite notice under the provisions of Section 9-A of the Industrial Disputes Act, 1947 (hereinafter referred to as the Act). It was claimed by the workmen that by virtue of the aforesaid shifting of the business they had to spend more in travelling to the place of work and that the petitioner was liable to compensate the workmen transferred for the amount so spent. The petitioner rejected the aforesaid claim of the workmen and denied that there had been any alteration of the conditions of service of any of its employees or that there had been any transfer of any employee.
4. By an Order of Reference No. 4055-IR dated the 27th September, 1963 the Government of West Bengal referred the following dispute between the petitioner and its workmen to the Third Industrial Tribunal for adjudication:—
Whether the employees are entitled to any allowance or relief to compensate them for additional expenses incurred by them by way of conveyance charges as a result of their transfer from 6, Lyons Range, Calcutta to Goabaria, Howrah and Camac Street, Calcutta?
5. By its Award dated the 31st May, 1966 which was published in the Calcutta Gazette dated the 14th July, 1966, the Third Industrial Tribunal held that the workmen transferred to Goabaria, Howrah from the date of the transfer were entitled to get from the petitioner travelling allowance at the following rates:—
1. Workers living in Howrah town at the rate of Rs. 12 per month.
2. Workers living in the suburbs and districts of Howrah and Hooghly at the rate of Rs. 21 per month.
3. Workers living in Calcutta and its suburbs 24 Parganas at the rate of Rs. 32 per month.
4. Workers using Company's launch at the rate of Rs. 10 per month. In case they are denied the launch, they will get compensation as in No. 3 at the rate of Rs. 32 per month.
6. In respect of workmen alleged to have been transferred to Camac Street, the Tribunal held that they were not entitled to any compensation.
7. It is this Award of the Third Industrial Tribunal dated the 31st May, 1966 which is challenged before me in this application.
8. Mr. P.P Ginwalla appearing on behalf of the petitioner contended, in the first place, that there was no transfer of any of the workmen of the petitioner in the facts and circumstances of the present case. He contended that as a result of the termination of the Managing Agency Agreement with Turner Morrison & Company Limited the petitioner had to shift its entire business from 6, Lyons Range, Calcutta. When the entire business or undertaking is shifted from one place to another there is no transfer of any of the workmen employed in the business. He further contended that the employer has an inherent right to carry on its business at any place of Ms choice. It is an implied term of every contract of employment that the workman must present himself to the place of work wherever it is. Mr. Ginwalla argued that the expenses incurred by an employee in reaching the place of work from his residence is not and cannot be, by its very nature, a condition of service. It was pointed out that if this expense was a condition of service, then It win always be open to an employee to alter that condition unilaterally by changing his residence and thereby altering the expenses involved in reaching the place of work. As there was no transfer of any employee involved in the present case, there could be no industrial dispute arising therefrom and the Tribunal had no jurisdiction to entertain the reference.
9. In support of this contention Mr. Ginwalla relied on a decision of the Court of Appeal in England in the case of Newsom v. Robertson (Inspector of Taxes) reported in (1952) 2 ALL ER 728. In that case Mr. Newsom a Barrister, had Ms chambers in Lincoln's Inn and his home at Whipsnade, Bedfordshire. He claimed the expenses incurred by him in travelling to and from between his home and Ms chambers as expenses deductible from Ms gross income for the purpose of income-tax as money wholly and exclusively laid out and expended for the purposes of his profession or vocation.
10. In dealing with this contention Denning, L.J observed as follows:—
“One thing is quite clear, that Whipsnade, as a locality, has nothing to do with Mr. Newsom's practice.
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If he had found a house that suited him in Hertfordshire or Oxfordshire, everything would have gone on in precisely the same way There is, I think, force in the criticism of counsel for the Crown of the form of the Commissioners' finding in the Crown's favour, which I have read, namely, that there was a dual purpose. Mr. Newsom's purpose in making the journeys was to get home in the evening or at week-ends. The fact that he intended to do professional work when he got there and did so does not make this even a subsidiary “purpose” of Ms profession. An author who has to go to the seaside to recuperate may write an article while he is there, but in ordinary language that was not the purpose of the journey. He was exercising his profession there, but some authors who do not depend on libraries or local colour can do that anywhere. The places where they exercise their profession would be irrelevant to their profession and I cannot see how the cost of moving from one to the other could be said to be wholly and exclusively laid out for the purpose of their profession. It would be laid out because the author found it pleasant to have, say, two homes. The position would not. I think, be affected by the fact that the author might be entitled to a study allowance in one or, perhaps, both of Ms homes.”
10A. Denning, L.J referred to the fact that in the days when income-tax was introduced in England most people lived and worked in the same place. The traderman lived over the shop, the doctor over the surgery, and the barrister over his chambers or, at any rate, close enough to walk to them or ride on Ms horse to them. Nowadays, however, people have to live away from place of work where they can find a house.
11. Denning, L.J went on to observe as follows:—
“What is the position of people so placed? Are their travelling expenses incurred wholly and exclusively for the purposes of the trade, profession, or occupation? I think not. A distinction must be drawn between living expenses and business expenses. In order to decide into which category to put the cost of travelling, you must look to see what is the base from which the trade, profession, or occupation is carried on. In the case of tradesman, the base of Ms trading operation is his shop. In the case of a barrister, it is his chambers. Once he gets to his chambers, the cost of travelling to the various courts is incurred wholly and exclusively for the purposes of his profession. But it is different with the cost of travelling from Ms home to his chambers and back. That is incurred because he lives at a distance from his base. It is incurred for the purpose of Ms living there and not for the purposes of his profession, or at any rate not wholly or exclusvely, and this is so whether he has a choice in the matter or not. It is a living expense as distinct from a business expense.
On this reasoning I have no doubt that the Commissioners were right in regard to Mr. Newsom's travelling expenses during term time. The only ground on which counsel for the taxpayer challenged their finding during term time was because Mr. Newsom had a study at his home at Whipsnade completely equipped with law books and did a lot of work there. The commissioners did not regard this as sufficient to make his home during term time a base from which he carried on his profession, and I agree with them. His base was his chambers in Lincoln's Inn. His home was no more a base of operations than was the train by which he travelled to and fro. He worked at home just as he might work in the train, but it was not his base.”
12. Although the above decision turned on the question of deduction of the cost of travelling from the residence to the place of work for the purpose of income-tax, Mr. Ginwalla invited me to apply the same principles in relation to a contract of employment. It was submitted that in the English case, it was found as a fact that Mr. Newsom did a lot of work in his home at Whipsnade. In the present case, however, the workmen did not do any work connected with their employment at their residence. Accordingly, the present case stood on a stronger— footing from the point of view of Mr. Ginwalla's clients.
13. Two other cases between the present petitioner and certain other parties were appearing in the list along with this case. Since the question of the competence of the present Order of Reference was involved in all these applications, it was agreed by all parties that I shall allow submissions to be made on this question by counsel in all the three cases.
14. Accordingly I allowed Mr. R.C Deb, Advocate-General of West Bengal appearing on behalf of the respondent No. 4 in Matter No. 222 of 1967 (Cal.) (Shalimar Paints Ltd. v. Third Industrial Tribunal, W.B) to make his submissions on this question. Mr. Deb submitted that the English decision was solely concerned with the question of deduction from income-tax and was of no assistance in deciding the question before me. My attention was drawn to the provisions of Section 2-K of the Act which defines ‘Industrial dispute’ as any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the conditions of labour, of any person. According to Mr. Deb, the expenses of travelling to the place of employment can be connected with the employment, although it may not be “wholly and exclusively” laid out for such employment for the purpose of deduction under income-tax. According to this contention, the expenses of travelling are capable of being made a term of employment. In any event, such a demand for additional travelling expenses can be made before an Industrial Tribunal on considerations of social justice. Since such a claim is capable of being made a part of the “contract of employment”, there can be an industrial dispute in respect of this within the meaning of Section 2-K of the Act.
15. After an anxious consideration of the matter, I have come to the conclusion that Mr. Deb's argument cannot be accepted. Undoubtedly the cost of travelling from the residence of a workman to his place of work is capable of being made an express term of his employment. Admittedly, however, there is no such express stipulation in the contract of employment in the present case. The question that I have to decide is, whether in the absence of such an express stipulation, it can be said to be an implied term of employment so that any controversy with regard to it may be the subject-matter of an industrial dispute within the meaning of the Act. In my view, such an implied term cannot be read into a contract of employment. To read such an implied term in the contract of employment would in my view lead to certain absurd consequences. For one thing, the employee would be in a position to unilaterally alter such expenses of travelling by the choice of the place of his residence—a matter over which the employer has no control. In other words, if the employee chooses to live next door to the factory his travelling cost would be less and if he chooses to live far away the cost would be more. Similarly it would depend on the mode of transport adopted by the employee. If he chooses to travel by taxi, it would be much higher than if he travels by a bus or a tram. In the absence of any stipulation in the contract of employment that such a cost would be borne by the employer, the employee cannot, in my view, claim such costs as connected with his contract of employment or his condition of service.
16. With respect, I follow the principles laid down in the English Case and hold in favour of Mr. Ginwalla's contention that the employment commences when the employee reaches his place of work which, to adopt the expression used in the abovementioned case is “the base of operations”.
17. It, therefore, follows that just as an employee cannot make a claim for an extra allowance when he shifts his residence to a more distant place from his office there can be no claim for compensation when the employer shifts his business or undertaking from one place to another. The employer, in my view, has an inherent right to choose his place of business. The fact that some of the employees may have to incur additional expenses by way of travelling as a result of such shifting of employer's business or undertaking, does not entitle the employee to make a claim for extra benefit or compensation. In any event, such a claim cannot be made on the ground that there has been a transfer of employees. The expression “transfer,” in my opinion, connotes that an employer has more than one place of business and the employee is called upon to work in a different place of business from the one in which he worked previously. As I have said, however, there is nothing to prevent the employees from insisting that the cost of travelling would form an express stipulation in the contract of employment and has to be borne by the employer.
18. In that view of the matter, it must be held that there has been no transfer of the employees in the present case. Consequently, the present reference which proceeds on the footing that there has been such a transfer of the employees must be held to be incompetent. Since the Order of Reference is incompetent, the resulting Award must also be held to be without jurisdiction and void.
19. Mr. P.P Ghose appearing on behalf of State of West Bengal drew my attention in the first place to the definition of “wages” in Section 2(rr) of the Act. The expression “wages” has been defined as meaning all remuneration capable of being expressed in terms of money, which would, if the terms of employment, express or implied, were fulfilled, be payable to a workman in respect of his employment or of work done in such employment and includes money and other things such as travelling concession. According to Mr. Ghose, the travelling concession would include travelling expenses from the residence of the employee to his place of work and would therefore be comprised within term “wages” as defined in the Act. Since any dispute as to wages is capable of being the subject-matter of an industrial dispute, a dispute as to travelling expenses being a part of wages was also similarly capable of being made an industrial dispute.
20. Mr. Ghose next drew my attention to the Third Schedule of the Act which specifies matters which are within the jurisdiction of an Industrial Tribunal. Item No. 2 in the Schedule mentions compensatory and other allowances as a matter which is within the jurisdiction of an Industrial Tribunal. The expression “other allowances” according to Mr. Ghose is wide enough to include travelling expenses as in the present case and therefore it is a matter over which the Industrial Tribunal has jurisdiction. He also referred to the Item No. 3 of the Fourth Schedule of the Act which mentions compensatory and other allowances as items of conditions of service for change of which notice is to be given under Section 9-A of the Act. Consequently, he contended that travelling expenses could be a condition of service.
21. In my view, the definition of wages as given in the Act which may include travelling concession does not throw any light on the question before me. The expression travelling concession in its ordinary connotation would refer to such cases as for example when the staff of an employer is entitled to use a car or other medium of transport maintained by a Company for carrying its employees to the place of work. All that the definition says is that when such a concession is provided by the employer either in the form of free travelling or travelling at a reduced rate it would be part of wages as understood in the Act. In my view, the expression “travelling concession” cannot be equated with the expenses of travelling from the residence of the employee to his place of work as in the present case.
(In paragraphs 22 to 27 the Court declines to express any final opinion on the further contention of the petitioner that as an employer it has got an implied and inherent right to transfer its employees from one concern to another. The order then proceeds:)
28. In the result, this application succeeds and the Rule is made absolute. There will be a Writ in the nature of Certiorari quashing and setting aside the Order of Reference No. 4055-IR IR/III-184(A)/63 dated the 27th September, 1963 and the Award published in the Calcutta Gazette dated the 14th July, 1966 and Writ in the nature of Mandamus directing the respondent to forbear from giving effect thereto in any manner whatsoever.
29. There will be no order as to costs.
30. Petition allowed.