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Smart Summary

Structured Summary of the Opinion (Raj Kishore Prasad, J.)

Factual and Procedural Background

The petitioner is the Superintendent of Collieries, Giridih, responsible for payment of wages under Section 3 of the Payment of Wages Act, and he challenged an order dated 7 September 1955 made by the Deputy Commissioner of Hazaribagh (opposite party No. 1). The impugned order, made under Section 15(3) of the Payment of Wages Act, directed the petitioner to refund bonus amounts that had been realised (deducted) from opposite parties 2 to 5 (workmen at Karbarbaree Colliery) on the ground that those workmen had been illegally paid the bonus in contravention of the Coal Mines Bonus Scheme, 1948.

The factual background as set out in the opinion: bonus had been paid by oversight to a number of workmen, including opposite parties 2–5. On the auditor's pointing out the mistake, the petitioner attempted to recover (realise) the mistaken payments by way of deduction from wages. Opposite parties 2–5 filed a statutory application under Section 15(2) of the Payment of Wages Act before opposite party No. 1 seeking directions under Section 15(3) to order refund of the sums and compensation of Rs. 100 each. After notice, inquiry (including an inspector's report identified as Annexure A) and hearing, opposite party No. 1 directed refund and warned of further legal steps if the employer failed to comply. The petitioner applied to this Court under Articles 226 and 227 seeking a writ of mandamus restraining opposite party No.1 from giving effect to his order and certiorari to quash the order.

Legal Issues Presented

  1. Whether the Deputy Commissioner (opposite party No. 1) had jurisdiction under Section 15(3) of the Payment of Wages Act to direct refund and compensation where the amounts deducted by the employer were for bonus payments which, on construction of the Coal Mines Bonus Scheme, 1948, were not legally due to the employees.
  2. How paragraphs 4(a) and 6(1) of the Coal Mines Bonus Scheme, 1948, should be construed in relation to qualification for bonus (specifically, whether employer‑granted leave up to 21 days can be counted to make up the 169 days of attendance required for Category II employees).

Arguments of the Parties

Petitioner's Position (Superintendent of Collieries)

  • The petitioner contended that the bonuses were paid by oversight to persons who did not satisfy the qualifying conditions of paragraph 4(a) read with paragraph 6(1) of the Coal Mines Bonus Scheme, 1948, and hence those sums were not legitimately payable.
  • The petitioner asserted entitlement to recover (deduct) the mistakenly paid bonus amounts from wages, and therefore the remedy under Section 15(3) could not be invoked by the employees because the sums did not constitute recoverable "wages" within the meaning of the Payment of Wages Act.
  • In supplementary affidavit the petitioner stated specific facts: opposite parties 2–4 were appointed on 1 December 1948 and opposite party 5 on 10 September 1948; during 1947 opposite parties 2–4 had not been granted any leave and service registers produced before opposite party No.1 supported the absence of employer‑granted leave within the meaning of paragraph 6(1).

Opposite party No. 1 (Deputy Commissioner) — position as reflected in his order

  • Opposite party No. 1 directed refund to the workmen on the view that the bonus had been granted and that the absence could be treated as leave even if the leave was not reduced to writing or specifically described at the time of grant; the Court characterises his approach as accepting that leave had been granted despite lack of documentary evidence.

Opposite parties 2–5 (Workmen)

  • They applied under Section 15(2) contending that Rs.3 per head had been deducted from specified wage periods and sought refund under Section 15(3) and Rs.100 compensation each. They showed cause through counsel but did not file counter‑affidavits or produce evidence to establish that employer‑granted leave (as required by paragraph 6(1) of the Scheme) had been given.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Court proceeded through the following analytical steps, closely tied to statutory language and documentary facts:

  1. Identification of the relevant Scheme provisions and statutory context: Paragraph 4(a) of the Coal Mines Bonus Scheme, 1948, requires Category II employees to have put in attendance for not less than 169 days during the period 12 May 1947 to 31 December 1947 to qualify for bonus; paragraph 6(1) provides that leave (including sick leave) granted by the employer, up to an aggregate of 21 days in a calendar year, shall count as days of attendance for the purposes of paragraphs 4 and 5.
  2. Classification: It was admitted that opposite parties 2–5 were Category II employees. Opposite party No.1 recorded that their attendance fell short by 10 days or less, so they plainly did not meet the 169‑day threshold absent the addition of employer‑granted leave.
  3. Construction of paragraph 6(1): The Court emphasised the textual requirement that the leave must have been "granted by the employer." The judge reasoned that paragraph 6(1) permits addition of up to 21 days only if the employer actually granted such leave; mere absence by the employee for any reason cannot be treated as employer‑granted leave and cannot be counted towards the statutory attendance threshold.
  4. Evaluation of evidence: The petitioner produced service registers before opposite party No.1 and swore by supplementary affidavit that no leave had been granted in 1947 to opposite parties 2–4 (and that opposite party 5 was appointed in 1948 so the 1947 period was not applicable). Opposite parties 2–5 produced no counter‑affidavit and no evidentiary material to show employer‑granted leave.
  5. Assessment of the Deputy Commissioner's order: The Court found that opposite party No.1's finding that leave had been granted relied on speculation and inference rather than on facts or material on the record; the impugned order was characterised as being based on conjecture and imagination rather than evidence.
  6. Relation to the Payment of Wages Act: The Court examined the definition of "wages" in Section 2(vi) of the Payment of Wages Act (which includes bonus as remuneration in appropriate circumstances) but concluded that the bonuses paid to opposite parties 2–5 were not legitimately payable under the Scheme and thus did not fall within the meaning of "wages" for the purpose of attracting the protective reclamation mechanism in Section 15(1) and (3). Consequently, the statutory jurisdiction under Section 15(1) to entertain claims arising from deductions from "wages" was not attracted.
  7. Conclusion from analysis: Because (a) opposite parties 2–5 did not meet the qualification conditions under paragraph 4(a) read with paragraph 6(1), (b) there was no evidence of employer‑granted leave, and (c) the Deputy Commissioner's order was based on speculation, the order was illegal and without jurisdiction. The petitioner was therefore entitled to recover the amounts via deduction and the statutory refund mechanism invoked by the employees could not be properly applied by the authority under Section 15(3).

Holding and Implications

Holding: The Court made the rule absolute. It held that the Deputy Commissioner (opposite party No.1) had no jurisdiction under Section 15(3) of the Payment of Wages Act to order refund of the bonus amounts or to award compensation to opposite parties 2–5, because the bonuses were not payable under paragraph 4(a) read with paragraph 6(1) of the Coal Mines Bonus Scheme, 1948, and the Deputy Commissioner based his order on speculation without evidence. A writ in the nature of mandamus was issued directing opposite party No.1 not to give effect to his order dated 7 September 1955, and a writ in the nature of certiorari was issued quashing that order.

Immediate Consequences for the Parties:

  • The impugned order dated 7 September 1955 of opposite party No.1 is quashed.
  • Opposite party No.1 is commanded by mandamus not to give effect to that order and not to require refund of the amounts realised by the petitioner from opposite parties 2–5.
  • The petitioner is validated in his entitlement to recover those mistakenly paid bonus amounts by deduction because, on the Court's construction, the sums did not qualify as recoverable "wages" under the statutory mechanism invoked by the employees.
  • No order for costs was made.

Broader Implications: The opinion confines its reasoning to statutory construction of the relevant Scheme provisions and the statutory scheme of the Payment of Wages Act, and it rests the decision on the absence of evidence and the limits of the authority's jurisdiction. The opinion does not purport to announce a new doctrine beyond the construction here applied; it is a decision directed to the facts and statutory provisions in the case.

Note: This summary is strictly limited to the material contained in the provided opinion and does not add information external to that text.

    Superintendent Of Collieries, Giridih v. Deputy Commr. Hazaribagh And Others Opposite Party.

    Raj Kishore Prasad, J.:— The petitioner is the Superintendent of Collieries, Giridih. He has presented an application to this Court, under Articles 226 and 227 of the Constitution, and asked for a writ, in the nature of mandamus commanding opposite party No. 1 who is the Deputy Commissioner of Hazaribagh, not to give effect to his order dated the 7th September, 1955, passed under Section 15(3) of the Payment of Wages Act, 1936 (Act IV of 1936), and, not to direct the petitioner to refund to opposite party 2 to 5, who are some of the workmen employed in Karbarbaree colliery in Giridih, the amount of bonus realised from them because it was illegally paid to them, in ignorance, and, in contravention of the provisions of the Coal Mines Bonus Scheme, 1948, framed under Section 6 of the Coal Mines Provident Fund and Bonus Schemes Act, 1948 (Act XLVI of 1948). He has also asked for a writ; in the nature of certiorari to quash the aforesaid order of the opposite party No. 1.

    2. The petitioner is the person who is responsible for the payment of wages, under Section 3 of the Payment of Wages Act to the workmen in the Collieries in Giridih, including Karbarbaree Colliery, in which opposite party 2 to 5 were also working.

    3. The petitioner's case is that the workmen of the said Colliery are entitled to the payment of bonus in terms of, and, on compliance with the conditions laid down in the Coal Mines Bonus Scheme, 1948. Through oversight and by sheer mistake, bonus was paid to many workmen, including opposite party 2 to 5, although they were not legally entitled to receive the same in accordance with the coal mines toonus Scheme. When the mistake was pointed out by the auditor, steps were taken to realise it from such workmen, including opposite party 2 to 5, by deduction from their wages. Opposite party 2 to 5, therefore, along with others, filed an application, under Section 15(2) of the Payment of Wages Act, before opposite Party No. 1, who is the authority appointed by the State Government, under S. 15(1) of the Act, to hear and decide all claims arising out of also deductions from the wages of persons employed, or paid, in the district of Hazaribagh.

    4. Their grievance was that Rs. 3/- per head had been deducted from their wages for the wage periods, contemplated by Section 4 of the Payment of Wages Act, in respect of which wages were paid to them on 21-4-1955, 28-4-1955 and 5-5-1955, at Re. 1/- per head per week, and, they therefore, prayed for directions under sub-s. (3) of S. 15 of the Act, directing the petitioner to refund the amount illegally deducted from their wages, and to pay compensation amounting to Rs. 100/- to the opposite party 2 to 5.

    5. On this application, opposite party 1 issued a notice to the petitioners, who showed cause before him. Opposite party 1, thereafter, after hearing the parties and considering the report of the enquiry, submitted by the Inspector, which is Annexure A to the application, passed orders on the 7th September, 1955, directing the petitioner under sub-s. (3) of S. 15 of the Act, to refund the amount, deducted from the wages of the opposite party 2 to 5 to them, and, he further directed that in the event of the employer's failure to make the aforesaid payment to opposite party 2 to 5 as directed, further legal action for realisation of the amount in question will be taken.

    6. Mr. Ray Parasnath, Government pleader, in support of the rule, has argued that the directions given by opposite party No. 1 under sub-s. (3) of the Section 15 of the Payment of Wages Act, are illegal and ultra vires, and, therefore, they should be quashed.

    7. Paragraphs 4(a) and 6(1) of the Coal Mines Bonus Scheme are the relevant provisions for the present case, and, they read as follows:

    “4. Qualification for bonus in coal mines in West Bengal and Bihar—An employee in a coal mine in West Bengal or Bihar shall qualify for a bonus from his employer—

    (a) in respect of the period from the twelfth of May, 1947 to the thirty first of December, 1947, provided he has put in attendance in the coal mines during that period for not less than 121 days if a Category I employee, or for not less than 121 days if a category I employee, or for not less than 169 days if a Category II employee:

    6. Allowance for leave etc.—(1) For the purposes of paragraphs 4 and 5 of this Scheme, leave (including sick leave) granted by the employer to an aggregate of 21 days in a calendar year and days if idleness caused by any temporary breakdown of machinery or any other technical reason shall count as days of attendance.

    8. Paragraph 4(a) clearly provides that a category II employee in a coal mine in Bihar shall qualify for a bonus from his employer in respect of the period from the 12th of May, 1947, to the 31st of December, 1947, provided he has put in attendance in the coal mine during that period for not less than 169 days. “Category II employee” has been defined in paragraph 2(b) of the Scheme as meaning an employee in a coal mine other than a “Category I employee” who under paragraph 2(a) means underground miner or any other underground piece worker.

    9. It is admitted that opposite party 2 to 5 were category II employees. Paragraph 3 of the Scheme provides that, except in the cases mentioned in the exceptions (a) to (d), appended to it, every employee in a coal mine, to which this scheme applies, shall be eligible to qualify for a bonus. On the language of paragraph 4(a), therefore, it is plain that Category employee, in order to be entitled to earn a bonus from his employer, must have put in attendance for not less than 169 days during the period 12th of May, 1947, and the 31st December, 1947, otherwise he cannot take the benefit of paragraph 4(a).

    10. In the instant case, opposite party 1 has mentioned in his order that the attendance of opposite party 2 to 5 fell short of 10 days, or less. It is, therefore, undisputed that the opposite party 2 to 5 had not put in an attendance of 169 days as required by paragraph 4(a), and, therefore, they did not satisfy the condition precedent laid down in paragraph 4(a) and, as such, prima facie, they were not entitled to a bonus under it.

    11. Paragraph 6(1) of the Scheme, however, provides that for the purpose of paragraph 4, above mentioned, “leave (including sick leaves) granted by the employer, to an aggregate of 21 days in a calendar year, shall count as days of attendance.” Under paragraph 6(1), therefore, only if the employer has granted leave, including sick leave to his employee, and not otherwise to an aggregate of 21 days in a calendar year, such period of leave shall count as days of attendance, and, such period of leave to an aggregate of 21 days can be added to make up the shortage, if any, in the attendance, of 169 days, contemplated by paragraph 4(a) in order to enable the employee to take advantage of the benefit of bonus conferred by paragraph 4(a) of the Scheme, upon him.

    12. In the present case the petitioner has filed a supplementary affidavit stating that opposite party 2 to 4 were appointed on the 1st December, 1948, and, opposite party 5 was appointed on the 10th September, 1948. He has further stated that during the year 1947, opposite party 2 to 4 were not granted a single day's leave and no such question arose in case of opposite party 5, because he was appointed in 1948, after the relevant period, which is 12th May, 1947, to the 31st December, 1947, as mentioned in paragraph 4(a) of the Scheme. The petitioner has further stated in his supplementary affidavit that the service registers of opposite party 2 to 5 were produced before opposite party 1 at the hearing in support of the fact that no leave was granted to the opposite party 2 to 5 as contemplated by paragraph 6(1) of the Scheme.

    13. Opposite party 1 proceeded to pass orders on the basis that because opposite party 2 to 5 were granted bonus under the Scheme, it could not have been allowed to quote his own words, “except by the grant of leave even though the orders might not have been reduced to writing or even though while allowing the leave to the petitioners (that is, opposite party 2 to 5, and others) he might not have described, the period of leave.”

    14. From a perusal of the impugned order of opposite party 1, therefore, it is plain that he has gone on purely speculation and, has drawn inference, not from facts, or materials, or evidence before him, but from mere imagination. It is not open to a Court or anybody, or officer, or authority, who is entrusted with quasi-judicial functions, to base his decision on mere conjecture and speculation, and to draw upon his own imagination for coming to a certain finding and to imagine such a fact or state of affairs must have existed, or happened. He is not entitled to make a pure guess, and make an order without reference to any evidence or any material at all.

    15. Opposite party 2 to 5 have also shown cause through Mr. Umesh Chandra Prasad Sinha. But they have neither filed any counter-affidavit, nor, produced any evidence or material in support of their case that leave had actually been granted by the employer to them.

    16. In my judgment, therefore, the order of opposite party 1 being based on mere guess, and on no evidence or material, is illegal and without jurisdiction.

    17. On the true construction of paragraphs 4(a) and 6(1) of the Coal Mines Bonus Scheme, 1948, it is manifest that an employee shall qualify for a bonus from his employer only when he has put in an attendance of 169 days, if he is a Category II employee, during the relevant period from the 12th May, 1947, to the 31st December, 1947, and, further that any shortage, in the attendance for the requisite period, can be made up, only up to the extent of 21 days, by adding the same to the period, which is short, to make up the requisite attendance, but only if leave to an aggregate of 21 days has been granted by the employer to such, employee, and not otherwise.

    18. If leave has not been granted by the employer to the employee, the absence of the employee for any period whatsoever and for whatever cause it may be, cannot be added to the short attendance in order to make up the statutory attendance, in, order to qualify for the bonus, which is mandatory for such an employee to put in. The words “leave granted by the employer occurring in paragraph, 6(1) leave no room for doubt that the leave must, have been granted by the employer, and, if it is not granted, the absence of the employee cannot, be counted as days of attendance, and, taken into consideration to make up the period of attendance of 169 days, in the case of a category II employee, as required by paragraph 4(a).

    19. Opposite party 2 to 5 were, as such, not entitled to the bonus under paragraph 4(a) read with paragraph 6(1) of the Scheme, and, therefore, they got the bonus illegally obviously by mistake, and as such, the petitioner was entitled to deduct the amount of bonus paid illegally to opposite party 2 to 5.

    20. Such deductions from the wages of opposite party 2 to 5 were not illegal as to attract the-provisions of Section 15(3) of the Payment of Wages Act.

    21. The word “wages” has been defined in S. 2(vi) of this Act as below:

    “‘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, whether conditionally upon the regular attendance, good work or conduct or other behaviour of the person employed or otherwise, to a person employed in respect of his employment or of work done in such employment, and includes any bonus or other additional remuneration of the nature aforesaid which would be so payable and any sum payable to such person by reason of the termination of his employment, but does not include:—

    22. From the above definition, it will appear that “wages” include “bonus” also, which would be payable, to the person employed, in terms of his employment, as provided by S. 5 of the Act. Deductions, which may be made from the employees' wages, are mentioned in Ss. 7 and 9 to 13 of the Act. If however, deductions are made from the wages, otherwise than as period, then under S. 15 of the Act the employee concerned can claim a refund of such deductions made, and then alone the authority appointed under S. 15(1) of the Act will have jurisdiction to order refund of such deductions under S. 15(3) of the Act.

    23. In the case in hand, opposite party 2 to 5 were not entitled to the bonus under paragraphs 4(a) read with 6(1) of the scheme, as, such bonuses, paid to them did not come within the meaning of the word “wages” mentioned in S. 2(vi) of the Act.

    24. The petitioner, therefore, was entitled to deduct such amount of bonus from the wages of the opposite party 1 to entertain a claim arising out of such deductions from the wages of opposite party 2 to 5 was not attracted under S. 15(1) of the Act.

    25. In this view of the matter, opposite party 1 had no jurisdiction, acting under S. 15(3) of I, the Act, to give any direction either to refund the amount of bonus, which had been illegally taken by opposite party 2 to 5, and which, therefore, was being realised from them by the petitioner, or to direct the petitioner to pay any compensation to them.

    26. For the reasons given above, I would make the rule absolute and, allow the application. A writ in the nature of mandamus must, therefore, go commanding opposite party 1 not to give effect to his order dated the 7th September, 1955, and further directing him not to ask for refund from the petitioner of the amount of bonus realised from opposite party 2 to 5, who were paid that amount in contravention of paragraph 4(a) read with paragraph 6(1) of the Coal Mines Bonus Scheme, 1948. A writ in the nature of certiorari must also go quashing the impugned order dated the 7th September, 1955, of the opposite party 1. In the circumstances of the case, there will be no order for costs.

    27. Ramaswami, C.J:— I agree.

    H.G.D

    28. Rule made absolute.

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    Comments

    Superintendent Of Collieries, Giridih v. Deputy Commr. Hazaribagh And Others Opposite Party.
    (Dec 10, 1956)