1. The only question which arises for consideration, in this second appeal relating to execution proceedings is whether the amount of gratuity payable to a worker in a Cotton Mill by his employer constitutes ‘wages’ of a labourer as contemplated under section 60(h) of the CPC and as such is not liable to attachment.
2. The executing court before whom the question was raised held that such gratuity payable to a Mill worker constitutes his wages and as such is exempt from attachment.
3. On appeal the first appellate court came to the contrary conclusion and held that it is not wages and is attachable. That court directed the amount which had been called and lying in deposit in court pending consideration of this question, to be paid to the decree-holder. The judgment-debtor appeals.
4. In AIR 1945 Bom 119, Jivan Lal v. Ramtuji Bhaiji, his Lordship Sen, J., of the Bombay High Court had to consider whether the bonus, which a labourer in a Textile Mill in Ahmedabad was to receive for the year 1942, was attachable in execution of a decree for money. The definitions of the term wages as given in the Payment of Wages Act as also defined in Halsbury's Laws of England Volume 14 page 650 para 1227 were taken into account. It was observed with reference to the former that.
“the definition in the Workmen's Compensation Act does not refer to any terms of employment and prima facie the expression ‘benefit’ would perhaps include the payment of bonus”.
The learned Judge thereafter examined certain facts which had led to the decision of the Mill Owners' Association of Ahmedabad to pay bonus to their employees. It was found that an agreement was reached between the Ahmedabad Mill Owners' Association and the Textile Labour Association Ahmedabad in January 1942 whereunder the Textile workers at Ahmedabad were to receive bonus at a regulated scale such scale being based on the kind of work done and the number of working days and hours, attended by them. This agreement was held binding.
5. The learned Judge then referred to the definition of ‘wages’ given in Halsbury, Vol. 14, page 650, para 1227 and it was held that having regard to the wide amplitude of that definition the bonus payable to workers as per the aforesaid agreement became ‘wages’ of a labourer and was attachable. There it was further considered whether the term bonus implied ex-gratia payment or otherwise. It is unnecessary to consider that question in this casa as we are here concerned not with ‘bonus’ but with ‘gratuity’ which the judgment-debtor is to receive on cessation of his employment. The gratuity would, it may be presume, be payable not ex-gratia but in accordance with a regulated scheme depending upon the period for which the worker had put in labour. Such a payment could not be considered ex-gratia.
6. In the present case the learned Additional District Judge has considered the definition of the term ‘wages’ as given in the Payment of Wages Act and has, relying upon clauses (d) and (6) held that in the absence of any evidence led by the judgment-debtor to show that the gratuity payable to him fell under cl. (d) it was not wages by reason of cl. (6). It was observed that there is nothing on record to show or suggest that the gratuity payable to judgment-debtor in this case is of a kind shown in cl, (d). The above referred Bombay decision as also the decision in AIR 1954 Sau 19, Harji Malla v. Karsanji, were distinguished on the ground that they related to ‘bonus’ and not to gratuity.
7. It is contended that this view of the court below is erroneous.
8. Now the term ‘wages’ is not defined in the Code of Civil Procedure and we will therefore have to take into account the ordinary meaning of the term. We may also refer to such meaning of the term as attaches to it under different legislative provisions to arrive at the exact significance of that term for the purposes of Sec. 60(h).
9. The term wages according to Oxford's Concise Dictionary means ‘amounts paid periodically during the time a workman or a servant is at the employer's work or business.’ Wharton's Law of Lexicon mentions it to mean compensation agreed upon to be paid by a master to a servant or to any other person hired to do any work or business for him.
In Halsbury's Laws of England Vol. 14 page 650 para 1227 wages is defined as under:
“Any money or other thing had or contracted to be paid, delivered, or given as a recompense, reward, or remuneration for any labour done or to be done, whether within a certain time or to a certain amount, or for time or an amount uncertain, is deemed to be the wages of such labour.”
Under the Payment of Wages Act the term is defined as—
“‘Wages’ means; all remuneration (whether by way of salary, allowances or otherwise) expressed in terms of money or capable of being so expressed which would, if the terms of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment or of work done in such employment, and includes—
(a) any remuneration payable under any award or settlement between the parties or order of a court;
(b) any remuneration to which the person employed is entitled in respect of over time work of holidays or any leave period;
(c) any additional remuneration payable under the terms of employment (whether called a bonus or by any other name);
(d) any sum which by reason of the termination of employment of the person employed is payable under any law, contract or instrument which provides for the payment of such sum, whether with or without deductions, but does not provide for the time within which the payment is to be made;
(e) any sum to which the person is entitled under any scheme framed under any law for the time being:n force; but does not include—
(1) any bonus (whether under a scheme of profit sharing or otherwise) which does not form part of the remuneration payable under the terms of employment or which is not payable under any award or settlement between the parties or order of a court;
(2) the value of any house accommodation, or of the supply of light, water, medical attendance or other amenity a of any service excluded from the computation of wages by a general or special order of the State Government;
(3) any contribution paid by the employer to any person or provident fund, and the interest which may have accrued thereon;
(4) any travelling allowance or the value of any traveling concession;
(5) any sum paid to the employed person to defray special expenses entailed on him by the nature of his employment; or
(6) any gratuity payable on the termination of employment in cases other than specified in sub-cl. (d).”
The definition in the Workmen's Compensation Act, is—
“‘wages’ includes any privilege or benefit which is capable of being estimated in money, other than a traveling allowance or the value of any travelling concession or a contribution paid by the employer of a workman towards an/pension or provident fund or a sum paid to a workman to cover any special expenses entailed on him by the nature of his employment.”
Section 2(rr) of the Industrial Disputes Act, defines—
“‘wages’ means 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—
(i) such allowances (including dearness allowance) as the workman is for the time being entitled to;
(ii) the value of any house accommodation or of supply of light, water, medical attendance or other amenity or of any service or of any concessional supply of foodgrains or other articles;
(iii) any travelling concession;
but does not include—
(a) any bonus;
(b) any contribution paid or payable by the employer to any pension fund or provident fund or for the benefit of the workman under any law for the time being in force;
(c) any gratuity payable on the termination of his service”.
10. The Minimum Wages Act, 1948, also contains a definition of the term—
“‘wages’ means all remuneration, capable of being expressed in terms of money, which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment or of work done in such employment, and includes house rent allowance but does not include—
(i) the value of—
(a) any house accommodation, supply of light, water, medical attendance, or
(b) any other amenity or any service excluded by general or special order of the appropriate Government;
(ii) any contribution paid by the employer to any Pension Fund or Provident Fund or under any Scheme of social insurance;
(iii) any travelling allowance or the value of any travelling concession;
(iv) any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment; or
(v) any gratuity payable on discharge”.
11. Now out of these various meanings or definitions of wages we will have to omit from consideration such of them as are meant for a special purpose having no bearing on the object for which the exemption from attachment in execution of a decree is granted, in respect of wages of a labourer. This object is that the labourers may not be deprived of the means of their livelihood by depriving them of their earning which are generally their only source for that purpose. Another object probably is that a labourer may not lose incentive for work. If he knows that his earnings will be taken away by a creditor who has obtained or who will obtain a decree for money against him he will have no heart in the work.
12. If then these are the objects of granting exemption to the wages we must take that as the meaning or definition of the term which can best serve such objects. It cannot be disputed that the daily or weekly, fortnightly or monthly wages which a labourer gets for the work he puts in will naturally be included in this term. The question however is whether what he gets as gratuity by the termination of his employment constitutes wages. This gratuity is payable either under express or implied contract between the employer and the labourer. It serves several purposes. In the first place it becomes useful for his livelihood until he is able to secure alternative employment. But more important reason for the grant of gratuity is to induce the labourer to stick to a particular job thereby augmenting skill and efficiency and thereby leading to greater production. It is a sort of a differed payment of wages and cannot in any sense be called a bounty. In that view of the matter gratuity payable to a labourer on the termination of his employment is as much his wages as what he gets periodically. The mere fact that he gets a lump sum at one point of time and is in addition to what he gets in lieu of notice etc. will make it any the less wages.
13. The general definitions of the term wases as are given in the Oxford Dictionary, Law of Lexicon and Halshury's Laws of England as indicated above appropriately cover the payment by way of gratuity. Even the definitions of the terms as given in the Workmen's Compensation Act, 1923, and Payment of Wages Act, 1936, are wide enough to include the same. The learned judge of the Lower Appellate Court felt difficulty in treating gratuity as Wages in the absence of evidence that the gratuity in this case does not fall in the category as mentioned in Section 2(vi)(6) of the Payment of Wages Act as amended. This view is not correct as in the first place it is not the definition as given in the aforesaid special Act which ought to govern the matter but it is the general meaning of the term having regard to the object behind section 60(h) of the CPC. In the second place gratuity which is generally paid on the termination of the employment Would fall under clause (d) of section 2(vi) that clause being sufficiently comprehensive. No doubt the definition in the Minimum Wages Act No. XI of 1948 specifically excludes gratuity payable to a worker or labourer from the term wages but this is done because the object of the Act is to provide for fixing minimum rates of wages in certain employments. The definitions in the Industrial Disputes Acts are not uniform. Whereas under the Industrial Disputes Act, 1947, the gratuity is excluded from ‘wages’ under the Madhya Pradesh Industrial Relations Act it is included within the term vide Section 2(35)(vi). These special definitions for special purposes will have to be left out of account.
14. From the foregoing discussion it;s clear that the term ‘wages’ as used in section 60(h) of the CPC ought to include gratuity as well.
15. It may be observed that since ‘bonus’ payable to a worker under certain circumstances becomes his wages there is all the greater reason to include gratuity in the category of wages.
16. For these reasons the decision of the court below is not correct and ought to be set aside, I would therefore hold that the gratuity payable to the judgment-debtor appellant being his wages is not attachable in execution.
17. The appeal is consequently allowed and the decision of the court of first instance is restored with costs throughout.
FF/H/VBB.
18. Appeal allowed.