Translate
Text Highlighter

Bookmark

PDF

Share

Report a problem
AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
Judges
Acts
  • S. 15 of the Payment of Wages Act, 1936 (in short the Act)
  • JAGDISH CHANDRA (1) RULE
  • PAYMENT OF WAGES ACT
Are you a practicing lawyer?
Enhance your digital presence and reach by creating a Casemine profile.
Upload pleading to use the new AI search
Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
Judges
Acts
  • S. 15 of the Payment of Wages Act, 1936 (in short the Act)
  • JAGDISH CHANDRA (1) RULE
  • PAYMENT OF WAGES ACT
Smart Summary

Factual and Procedural Background

Respondent No. 1, Kaineshwar Dubey (the workman), was employed as a Khalasi (casual labour) by the railways from 20-12-1969 and was dismissed by an oral order dated 29-5-1974. He filed Suit No. 233 of 1975 against the Union of India through the General Manager, Northern Railway, seeking a declaration that his dismissal was illegal, void, mala fide, and a nullity, and claiming continuation in service with all attendant benefits. The trial court granted this declaration on 13-10-1981, holding the dismissal void and entitling the workman to service benefits.

The petitioner Union of India appealed against this judgment, but the first appeal (RCA No. 13/82) was dismissed on 27-9-1983, and the second appeal was also dismissed on 8-8-1984. The Union’s Special Leave Petition was rejected by the Supreme Court on 20-1-1986.

Despite these decisions, the workman was neither reinstated nor paid arrears of wages. Consequently, he filed a petition under Section 15 of the Payment of Wages Act, 1936 on 3-6-1985. The authority under the Act, Shri M. K. Seth, directed the Union of India to pay Rs. 80,591.42 as wages and Rs. 1 lac as compensation on 7-8-1985. The Union did not appear, and its application to set aside this ex parte order was dismissed as frivolous on 3-1-1986. Further objections under Section 47 of the Code of Civil Procedure were also dismissed on 29-4-1986.

The Union filed appeals under Section 17 of the Act on 28-4-1986 and obtained a stay directing deposit of the amount but prohibiting its release to the workman until further orders. After dismissal of these appeals on 28-3-1987, the workman sought immediate release of the deposited amount, but the application was dismissed on 2-4-1987. The High Court, however, quashed the dismissal order and directed payment of the wages portion of Rs. 80,591.42 to the workman forthwith on 27-5-1987, while restraining payment of the compensation amount of Rs. 1 lac.

Legal Issues Presented

  1. Whether the wages paid to the workman under the authority’s direction were wages deducted or wages delayed, which determines the quantum of compensation payable under Section 15(3) of the Payment of Wages Act, 1936.
  2. Whether the petitioner Union of India’s contention that deductions under the Act only relate to specific sections applies to the present case.
  3. Whether the petitioner’s failure to implead the correct authorities responsible for payment under Section 3 of the Act affects the validity of notices and recovery proceedings.

Arguments of the Parties

Petitioner Union of India’s Arguments

  • The Act contemplates only those deductions from wages recognized by Sections 7 to 12, 12A, and 13, not the deductions claimed in this case.
  • The workman did not implead the Chief Project Manager, Railway Electrification, Mathura or the General Manager, Western Railway Bombay, who were responsible for payment under Section 3 of the Act, rendering notices to the General Manager, Northern Railway ineffective.

Workman’s Position

  • The non-payment of wages despite multiple notices and litigations demonstrates an intention to deny liability, constituting a case of deducted wages rather than delayed wages.
  • The notices sent to the General Manager, Northern Railway were proper, and the petitioner’s failure to respond or raise objections earlier precludes acceptance of their plea regarding improper impleading.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Delta Forging Works v. Manik Karmakar, 1977 LIC 207(1) Clarification of 'deducted wages' vs. 'delayed wages' and intention of employer in determining compensation under Section 15(3) of the Payment of Wages Act. The Court relied on this to determine that the employer’s denial of liability constitutes deducted wages, justifying compensation up to ten times the wages deducted.
K. P. Mushran v. B. C. Patil, AIR 1952 Bom 235 (DB) Supports the interpretation of 'deducted wages' in the Payment of Wages Act. Used to reinforce the distinction between deducted and delayed wages for compensation purposes.
Upper India Coupar Paper Mills Co. Ltd. v. J. C. Mathur, AIR 1959 All 664 The word 'deductions' in Section 15 is used in a wide sense to include partial or full withholding of wages. Supported the broad interpretation of deductions beyond specific sections of the Act, countering the petitioner’s narrow reading.
LA Anant Ram and others v. District Magistrate, Jodhpur, AIR 1956 Raj 145 (S) Reinstatement implies deduction of wages for the period between dismissal and reinstatement. Applied to establish that the workman’s claim for wages during dismissal period falls within deducted wages.

Court's Reasoning and Analysis

The Court analyzed whether the unpaid wages were 'deducted' or merely 'delayed' under Section 15 of the Payment of Wages Act. It held that the critical factor is the employer’s intention: denial of liability or the employee’s right to wages constitutes deduction, whereas mere delay implies acknowledgment of liability. The Court found that the Union of India’s repeated failure to pay wages despite multiple notices and adverse judgments demonstrated a clear intention to deny liability, thus amounting to deducted wages.

The Court rejected the petitioner’s argument that only deductions specified in Sections 7 to 13 of the Act are recognized, interpreting the term 'deduction' in a wider sense consistent with precedent. The petitioner’s failure to implead the correct authorities was also dismissed because no such plea was taken earlier, and the petitioner did not respond to numerous notices sent to the General Manager, Northern Railway.

Consequently, the Court upheld the authority’s order directing payment of wages along with the substantial compensation of Rs. 1 lac, confirming the correctness of treating the unpaid wages as deducted wages under the Act.

Holding and Implications

The Court’s final decision is to dismiss the writ petition with costs and to order the immediate release of the compensation amount of Rs. 1 lac in favor of the workman.

This decision directly enforces the payment of both wages and compensation to the workman, affirming the interpretation of 'deducted wages' under the Payment of Wages Act. No new precedent beyond the application of existing principles was established.

    Union Of India v. Kameshwar Dubey And Others

    JAGDISH CHANDRA

    (1) RULE D.B. Respondent No. 1 Kaineshwar Dubey (hereinafter to be referred to as 'workman') was a railway employee employed as Khalasi (casual labour) with effect from 20-12-1969 and was dismissed from service by an oral order dated 29-5-1974. He brought a suit being Suit No. 233 of 1975 against the petitioner Union of India through the General Manager, Northern Railway, Baroda House, New Delhi for a declaration that his dismissal was illegal, void, inoperative, mala fide and a nullity and that he continued to be in service of the railway as. if he was not dismissed at all and was further entitled to all other benefits of the service. The decree for the aforesaid declaration was granted on 13-10-1981 by Shri Z. S. Lohat, Sub Judge 1st Class as a result of which his dismissal from service was held as void and was further-held to have continued in service and also entitled to all the service benefits. This decree was passed after contest by the petitioner

    (3) THE first appeal (RCA No. 13/82) of the petitioner Union of India through General Manager, Northern Railway against the aforesaid judgement and decree dated 13-10-81 of Shri Z. S Lohat, SJIC was dismissed on 27-9-1983 by others Shri J. B. Goel, Additional District Judge, Delhi. Even the second appeal of the petitioner was dismissed by the High Court vide order dated 8-8-1984 in RSA 32 of 1984. Even the Special Leave Petition of the petitioner against the said decree and judgement was dismissed by the Supreme Court on 20-1-1986.

    (4) AFTER having failed to be reinstated in service and not being paid his arrears of wages and other service benefits despite the aforesaid litigation ending every time in his favour, the workman filed a petition under S. 15 of the Payment of Wages Act, 1936 (in short the Act) against the petitioner on 3-6-1985 and Shri M. K. Seth the authority under the Act made a direction on 7-8-1985 to the petitioner-Union of India to pay to the workman within one month of the order a sum of of Rs. 80,591.42 on account of wages and allowances besides another sum of Rs. I lac as compensation for deduction of wages. This direction of the authority Shri N. K. Seth was ex parte as the petitioner-Union of India did not put up appearance despite service. The application of Union of India for setting aside the aforesaid ex-parte direction of the authority Shri M. K. Seth was dismissed on 3-1-1986 by Shri M. K.Seth as highly frivolous and not maintainable at all. The petitioner Union of India then filed objections under S. 47 of the Cade of Civil Procedure on 15-4-1986 against the recovery of the amount and payment of the same to the workman but those objections were dismissed on 29-4-1986.

    (5) APPEALS under S. 17 of the Act against the judgement dated 7-8-1985 and the order dated 3-1-1986 both passed by the authority Shri M. K. Seth were filed by the Union of India on 28-4-1986 before Shri Lokeshwar Prasad, then Additionai District Judge, Delhi.

    (6) ON the stay application filed along with the appeals of Union of India under S. 17 of the Act, order was passed on 6-5-1986 directing deposit of the amount within a week with a further order that the amount shall not be released to the decree-holder workman till further orders.

    (7) THE workman moved an application on 1-4-1987 for immediate release of the amount deposited as the appeals against the order of the authority Shri M. K. Seth had been dismissed on 28-3-1987 by Shri Lokeshwar Prashad. Additional District Judge on the ground that the appeals were not competent before him as he had no jurisdiction to entertain the same, but that application was dismissed on 2-4-1987 by the successor authority Shri Asharfi Lal. The civil writ No. 1042187 was filed in the High Court by the workman against Shri Asharfi Lal, authority under the Act for the quashing of the order dated 2-4-87 and that writ petition was disposed of on 27-5-1987 with the direction that the amount laying in deposit be paid to the workman forthwith and that order was

    " passed as the learned counsel appearing for the authority under the Payment of Wages Act conceded that the impugned order dated 2-4-1987 was illegal inasmuch as the interim order dated 6-5-1986 passed by Shri Lokeshwar Parshad no longer stood once the appeal in which it was passed, stood disposed of. The present writ before us being Civil Writ No. 1705187 had been filed in the moantime by Union of India through General Manager, Northern Railway, Baroda House, New Delhi seeking to quash the order dated 28-3-87 by Shri Lokeshwar Prashad, Additional District Judge (Appellate Authority under the Payment of Wages Act) along with an application being C.M. 2404187 for stay in respect of the realising of deposited amount of Rs. 1,80,591.42 by the workman and on that application partial restraint order was passed by us on 27-5-1987 whereby it was directed that the compensation amount of Rs. 1 lac awarded by the authority Shri M. K. Seth to the workman be not paid to the workman whereas the remaining sum of Rs. 80,591.42 which was due to the workman on account of wages and allowances was ordered to be paid to him forthwith, and it was not brought to our notice by the counsel for the petitioner Union of India that the order of release for the entire amount including the compensation amount of Rs. lac had been passed on"
    that very day, i.e. 27-5-1987 by another Division Bench of this Court in favour of the workman in Civil Writ No. 1042 of 1987 filed by the workman.

    (8) THE main question falling for determination in this petition whether the wages in question paid to the workman under the direction of the authority Shri M. K. Seth was on account of wages deducted or wages delayed, because if it is a case of wages deducted then under sub-sec. 3 of S. 15 of the Act the authority could, in addition to the payment of wages, also direct the payment of such compensation as the authority thinks fit not exceeding ten rimes the wages deducted but if it were the case of delayed wages the amount of compensation which the authority could order' besides the delayed wages, could not exceed twenty-five rupees. As in the case in hand the authority has held the amount of wages as deducted wages, compensation to the tune of Rs. 1 lac was also awarded by the authority under sub-sec. 3 of S. 15 of the Act besides the wages, to the petitioner, and it is on account of the huge amount of compensation that the question of wages being deducted wages or delayed wages assumes great importance. The determination of this question necessarily depends upon the intention of the employer. If his intention is to deny the liability to pay the wages or to deny the right of the workman to receive the same, it would be a case of 'wages deducted'. But if the employer concedes his liability to pay the wages to the workman and does not dispute the workman's right to the same, the case would be one of 'delayed payment'. This view of ours finds supprot from the decision of a Division Bench of Calcutta High Court reported as Delta Furging Works v. Manik Karmakar 1977 LIC 207(1) and K. P. Mushran v. B. C. Patil AIR 1952 Bom 235(2) (DB.).

    (9) THE learned counsel for the petitioner Union of India contended that the Act contemplated only those deductions from wages which were recognised by Ss. 7 to 2, 12A and 13 of the Act and not the ones in the case in hand. This contention cannot be accepted and the word 'deduction' has to be taken as having been used in the Act in the wider sense meaning 'to take away' denying the liability to pay the wages to the employee [vide-Delta Forging's case (Supra)] The meaning of the word 'deduction' appearing in S. 15 of the Act had also come up for consideration in the case of Upper India Coupar Paper Mills Co. Ltd. v. J. C. Mathur AIR 1959 All 664(3) before the Lucknow Bench of Allahabad High Court wherein it was held as follows :- "Deductions may relate to the specific heads mentioned in the particular sections of the Act or they may be deductions resulting from other causes. They may he the result of withholding of part of the Wage or of the entire amount of wages. The word 'Deductions' in Section 15 appears to be used in a wide sense so as to include the entire deficiency which the employee alleges, as a result of the withholding of the same by the employer whether partially or wholly."

    (10) LA Anant Ram and others v. District Magistrate, Jodhpur and another AIR 1956 Raj. 145(4) (S) it was told as under :-

    ".....In the cases before are the applicants were dismissed on tone date, and were reinstated on a later date. They were not paid their wages for the period between the dismissal, and the re-instatement. Their claim is for wages for this period. Their reinstatement clearly implies that the Authority deducted their wages wholly or in part for the period between dismissal and re-instatement, . ...."
    .

    (11) AS already pointed out above, in the casein hand UK workman was not paid his wages for the period since his removal from service on 29-5-1974 and it was only on 27-5-1987 that this Court ordered the payment of the wages amounting to Rs. 80,591.42 to be made to the workman and this payment order was made after the passing of the decree by Shri Z.S. Lohat, Sub Judge and the dismissal of the two appeals of Union of India and the direction of the authority Shri M. K. Seth under the Payment of Wages Act and the appeal against the order of the authority and the filing of the writ petitions. Even though the petitioner-Union of India deposited the amount under the orders of Lokeshwar Parshad, Additional District Judge in appeal against the order of the authority, it was further ordered that the deposited amount was not to be paid to the workman till further orders and this order of non-payment must have been made only at the instance of the petitioner-Union of India, It would be further seen from the order dated 7-8-1985 of the authority Shri M. K. Seth that a number of notices were given by the workman to the petitioner-Union of India (through General Manager, Northern Railway, Baroda House, New Delhi) requesting for his re-instatement and payment erf the arrears of wages to him after the passing of the decree in his favour by Shri Z. S. Lohat, Sub-Judge but the petitioner-Union of India did not care to give any reply to any of these notices, nor made the payment. These notices are dated 16-10-81. 14-10-81. 12-12-81, 29-5-82. 28-2-84,4-4-84 and 23-1-85. He also gave the notice dated 14-7-1986 to the Union of India for the said purpose but to no effect. These notices were given on different stages of the litigation, i.e. after the decree of the learned sub judge, after the disimissal of the first appeal of the petitioner, after the dismissal of the second appeal of the petitioner and after the direction from the authority. The total omission on the part of the petitioner-Union of India to pay the wages to the workmen was cleat indication on its part to deny its liability to pay the same to the workman as also the denial of the workman's right to receive those wages from the petitioner and this already clear position of the Union of India stands further clarified from the order of Shri Lokeshwar Parshad, Additional District Judge (the Appellate Authority under the Act) whereby the amount deposited in pursuance of the stay application of the petitioner was ordered not to be released to the workman till further orders' and, as already pointed out above, such direction must have been passed only at the instance of the petitioner. Even in the prayer clause of the present writ petition dated 25-5-1987 the petitioner while seeking the quashing of the orders dated 7-8-1985 and 28-3-1987 passed respectively by the authority and the appellate authority under the Act, does not even hint at its conceding the right of the workman to receive his wages, nor its liability to pay the same. The prayer for the whole-sale quashing of these two orders leaves no doubt in the position taken up by the petitioner regarding the denial of its liability to pay the wages to the workman and his right to receive the same from it. and when that is the animus of the petitioner-Union of India there is no escape from the conclusion that this is a case of deducted wages and not of mere delayed wages with the result that the authority under ths Payment of Wages Act was fully Justified in holding these wages as 'deducted wages' and consequently directing; the petitioner to pay the same together with the compensation amount of Rs. 1 lac to the workman.

    (12) THE next contention raised on behalf of the petitioner-Union of India is that the workman did not implead either the Chief Project Manager, Railway Electrification. Mathura or the General Manger, Western Railway Bombay the person responsible for making payment in terms of S. 3 of the Act with the result that the notices sent to the office of the General Manager. Northern Railway could not be connected and the same remained ill transmission from one office to ano^ier. This contention can- not be accepted because it would he seen that no such plea was taken by the petitioner in the written statement filed in the suit in the court of Sh. Z. S. Lohat, Sub Judge, Delhi, as conceded at the Bar during the course of arguments by Shri Dutt learned counsel for the petitioner, even though that suit was filed by the workman against Union of India through the General Manager, Northern Railway, Baroda House, New Delhi. This plea could have been taken in reply to any of the various notices sent by the workman to the General Manager, Northern Railway and in the face of no reply to any of the various notices sent by the workman, this plea of the petitioner cannot be accepted.

    (13) NO other point was urged and in view of the above discussion the writ petition fails and is dismissed with costs. The compensation amount of Rs. 1 lac be released in favour of the workman forthwith.

    Use AI to get other relevant cases.

    Comments

    Union Of India v. Kameshwar Dubey And Others
    (Aug 12, 1987)