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PETITIONER: GREAVES COTTON AND CO.  AND OTHERS

       Vs.

RESPONDENT: THEIR WORKMEN

DATE OF JUDGMENT: 14/11/1963

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. GAJENDRAGADKAR, P.B. GUPTA, K.C. DAS

CITATION:  1964 AIR  689            1964 SCR  (5) 362  CITATOR INFO :  R          1966 SC 305  (41)  RF         1967 SC1175  (12)  R          1967 SC1286  (8)  R          1969 SC 360  (20)  R          1972 SC 319  (10)  RF         1972 SC2273  (20)  R          1972 SC2332  (31,70,71,113,118)  RF         1973 SC2758  (11)  R          1974 SC 526  (15)  RF         1975 SC1778  (20)  R          1978 SC 982  (6,10)  R          1978 SC1113  (14)  R          1984 SC 356  (14)  RF         1986 SC 125  (14)  RF         1986 SC1794  (7)

ACT: Industrial Dispute-Wage Scales-Industry-cum-region  formula- Applicability-Division   of  unskilled  workers   into   two classes,   if   permissible-Dearness   allowance-Incremental scales-Adjustment.

HEADNOTE: The disputes between the appellant companies and the workmen which   were  referred  to  the  Industrial   Tribunal   for adjudication,  related  to  wages,  dearness  allowance  and gratuity.   The companies raised objections to the award  of the Tribunal on various grounds. Held:(i)   The   reference   in  the   award   to   the recommendations  of  the Tripartite Conference  wherein  the need-based  minimum  wage was evolved, did not  vitiate  the award, as the final decision was based not on them but on  a consideration of the wages prevalent incomparable  concerns so far as clerical and subordinate staff were considered. (ii) In applying the industry-cum-region formula for fixing wage  scales the Tribunal should lay stress on the  industry part  of the formula if there were large number of  concerns in the same region carrying on the same industry, but  where the  number of industries of the same kind in  a  particular region  was  small, it was the region part  of  the  formula which  assumed  importance  particularly  in  the  case   of

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clerical and subordinate staff. In the present case, the Tribunal was right in leaning  more on  the region part of the industry-cum-region  formula  and less on the Industry part. Workman of Hindustan Motors v. Hindustan Motors, [1962] 2. J.352  and  French  Motor Car Company  v.  Their  Workman [1963] Supp. 2. S.C.R. 16 considered. (iii)The  Tribunal  was not justified in  creating  two classes  of  higher  unskilled and lower  unskilled  in  the category  of  unskilled  factory-workmen in  the  matter  of fixation of wage-scales. (iv)Employees getting same wages should get the same scales of  dearness  allowance irrespective of  whether  they  were working  as  clerks,  or members  of  subordinate  staff  or factory-workmen. (v)In  fixing  the same rates of  dearness  allowance  for factory workmen as for clerical staff, it was necessary  for the  Tribunal when making comparisons to take  into  account the  total  wage packet and then compare it with  the  total wage packet of comparable 363 concerns and thus arrive at a just figure for basic wage for each category of factory-workmen. (vi)There  is  nothing  in law  to  prevent  an  industrial tribunal  from granting adjustments to the employees in  the revised  wage  scales even in a case where  previously  pay- scales were in existence, but this has to be done sparingly, taking  into  consideration the facts and  circumstances  of each case.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 272 to  280 of 1962. Appeals by special leave from the Award dated June 3,  1960, in reference (IT) Nos. 84 and 251 of 1959, June 15, 1960, in References (IT) Nos. 112 and 252 of 1959, June 16, 1960,  in References  (IT) Nos. 121 of 1959, and 7 of 1960,  June  15, 1960,  in References (IT) Nos. 123, 180 and 236 of  1959  of the Industrial Tribunal, Maharashtra at Bombay. S.V. Gupte, Additional Solicitor-General N. V. Phadke, J. B. Dadachanji,  O.  C.  Mathur  and  Ravinder  Narain  for  the appellants (in all the appeals). M.C. Setalvad, K.T. Sule, Madan G. Phadnis, Jitendra  Sharma and  Janardan  Sharma,  for the  respondents  (in  C.A.  No. 272/1962). K.T.  Sule, Madan G. Phadnis, Jitendra Sharma  and  Janardan Sharma, for the respondents (in C. As.  Nos. 273-280/62). November 14, 1963.  The Judgment of the Court was  delivered by WANCHOO J.-These nine appeals by special leave arise out  of the  awards of the Industrial Tribunal, Bombay and  will  be dealt  with together.  There were disputes between the  four appellants--companies  and the respondents,  their  workmen, which  were  referred  for adjudication  to  the  Industrial Tribunal  by nine reference-orders on various dates  between April to December 1959.  The main dispute which gave rise to the references was with respect to wages, dearness allowance and gratuity.  The references included other items also  but we  are  not  concerned in the present  appeals  with  those items.  Of the four companies who are the appellants before 364 us,  Greaves  Cotton and Co., is the first company  and  its main activity is to invest money in manufacturing  concerns.

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The second company is Greaves Cotton and Crompton  Parkinson Private Limited and its main business is distribution of the products  of  a  manufacturing  concern  known  as  Crompton Parkinson  (Works) India Limited and service and  repair  to the  said  products at its workshop.  The third  company  is Konyon  Greaves Private Limited and its main business is  to manufacture  high grade interstranded ropes for the  textile industry.   The last company is Ruston and  Hornsby  (India) Private Limited and its main business is to manufacture  oil engines and pumps.  The last three companies are  controlled by the first company, namely Greaves Cotton and Co., in  one way  or the other and that is how the main dispute  relating to  wages and dearness allowance was dealt with together  by the  tribunal.  There were two references each with  respect to  the  first  three companies and  three  references  with respect  to Ruston and Hornsby Private Limited; and that  is how  there  are  nine appeals before us.   There  were  nine awards, though the main award dealing with the main  dispute relating to wages and dearness allowance was common. It  appears that wages and dearness allowance  prevalent  in the  four companies had been continuing since 1950 when  the last  award  was made between the parties.  It may  also  be stated  that  there  was  no  .serious  dispute  before  the Tribunal  as to the financial capacity of the companies  and further,  as  the  first company controls  the  other  three companies, the wages and dearness allowance are the same  so far  as  the clerical and subordinate staff  are  concerned. The  same  appears to be the case with respect  to  factory- workmen. The  Tribunal  dealt  with clerical  and  subordinate  staff separately from the factory-workmen.  So far as the clerical and  subordinate staff are concerned, the Tribunal, after  a comparison of wages and dearness allowance prevalent in  the four companies with wages 365 and  dearness  allowance prevalent  in  comparable  concerns revised  them.   Further it provided bow  the  clerical  and subordinate  staff would be fitted in the new  scales  after making  certain adjustments and in that connection  it  gave one  to  three  extra increments depending  upon  length  of service between 1950 to 1959.  Finally, it ordered that  the award would have effect from April 1, 1959, which was a week before  the  first reference was made with  respect  to  the first company.  The Tribunal then dealt with the case of the factory-workmen  and  prescribed  certain  rates  of  wages. Further it gave the same dearness allowance to the  factory- workmen  as  to  the  clerical  and  subordinate  staff  and directed  adjustments  also on the same basis.   Finally  it considered  the question of gratuity and the main  provision in  that  respect was that the  maximum  gratuity  allowable would  be upto 20 months and a provision. was also  made  to the  effect that if an employee was dismissed or  discharged for misconduct which caused financial loss to the  employer, gratuity to the extent of that loss only will not be paid to the employee concerned. The main attack of the appellants is on the award as regards wages  and  dearness  allowance.   It  is  urged  that   the industry-cum-region formula, which is the basis for fixation of  wages  and  dearness allowance  has  not  been  properly applied by the Tribunal and it had been carried away by  the recommendations of the tripartite conference which suggested need  based minimum wages.  It is also urged  that  whatever comparison  was  made  was  with  concerns  which  were  not comparable and the wages awarded were even higher than those prevalent in any comparable concern.  It is also urged  that

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the  Tribunal  did  not consider the  total  effect  of  the increase  it  was  granting  in  basic  wage  and   dearness allowance  together as it should have done, for the  purpose of  finding  out  whether  the  total  pay  packet  in   the appellants’ concerns can bear comparison with the total  pay packet of the concerns with which the Tribunal had  compared the  appellants’ concerns.  In this connection it  is  urged that in flying 366 scales  of wages the Tribunal increased the maximum and  the minimum  and the annual rate of increment and decreased  the span  of  years  in  which the  maximum  would  be  reached. Adjustments made by the Tribunal are also attacked and so is the  order making the award enforceable from April 1,  1959. As to the factory workmen it is urged that the Tribunal made no attempt to make a comparison with wages prevalent even in what it considered to be comparable concerns.  Lastly it  is urged  that the Tribunal created a new category  of  factory workmen  called higher unskilled which was not demanded  and which in any case did not exist in any comparable concern. The  first  question therefore which falls for  decision  is whether  the  Tribunal  went  wrong  in  not  following  the industry-cum-region   principle  and  in  leaning   on   the recommendations  of the Tripartite Conference.  It  is  true that  the Tribunal begins its award with a reference to  the recommendations  of  the Tripartite Conference  wherein  the need-based minimum wage was evolved.  It is urged that  this disposed the Tribunal to pitch wage-scales too high.  It  is however  clear  from  the award  that  though  the  Tribunal discussed  the recommendations of the Tripartite  Conference at  some length, when it actually came to make the award  it did  not  follow those recommendations.  The reason  why  it referred to those recommendations was that the  respondents- workmen  based  their  claim on them  and  wanted  that  the Tribunal   should  fix  wagescales  accordingly.   But   the Tribunal’s conclusion was that it was not feasible to do so, though looking at the financial stability of the appellants, emoluments  needed upgrading.  It then went on  to  consider the wages prevalent in comparable concerns and finally fixed wages for the appellants on the basis of wages prevalent  in such concerns.  Though therefore the recommendations of  the Tripartite  Conference  are referred to  in  the  Tribunal’s award, its final decision is not based on them and what  the Tribunal  has  done  is to make  comparisons  with  what  it considered  comparable  concerns  so  far  as  clerical  and subordi- 367 nate staff are concerned.  We are therefore not prepared  to say that reference to the recommendations of the  Tripartite Conference  in the opening part of the award was  irrelevant and  therefore  the  rest of the award must be  held  to  be vitiated on that ground alone. The  main contention of the appellants however is  that  the tribunal has gone wrong in applying the  industry-cum-region formula which is the basis for fixing wages and dearness and has made comparison with concerns which are not  comparable. It  is also urged that the Tribunal has relied more  on  the region aspect of the industry-cum-region formula and not  on the   industry  aspect  when  dealing  with   clerical   and subordinate  staff and in this it went wrong.  Reference  in this  connection  is made to two decisions  of  this  Court, namely,   Workmen   of  Hindusthan  Motors   v.   Hindusthan Motors(’,) and French Motor Car Company v. Their Workman  (2 )  and  it  is emphasis that the  principles  laid  down  in Hindusthan  Motors’  case(")  were more  applicable  to  the

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present  case  than the principles laid down in  the  French Motor Car Co.’s case(2).  In the Hindusthan Motors  case(1), this Court observed that it was ordinarily desirable to have as  much  uniformity  as  possible  in  the  wage-scales  of different concerns of the same industry working in the  same region,  as this puts similar industries more or less on  an equal  footing  in their production  struggle.   This  Court therefore applied the wage-scales awarded by the Third Major Engineering  Tribunal  in Bengal in the case  of  Hindusthan Motors  also.   It is urged that the  Tribunal  should  have taken into account comparable concerns in the same  industry and  provided wage-scales on the same lines so that, so  far as  manufacturing  concerns  in  the  present  appeals   are concerned,   there  will  be  equality  in  the  matter   of competition.  In the French Motor Car Co.’s case(2)  however this  Court  held so far as clerical staff  and  subordinate staff  are  concerned that it may be possible to  take  into account (1) [1962] 2 L.L.J. 352. (2) [1963] Supp. 2 S.C.R. 16 368 even those concerns which are engaged in different lines  of business  for the work of clerical and subordinate staff  is more  or less the same in all kinds of concerns.  We are  of opinion  that  there  is no inconsistency as  urged  in  the principles laid down in these two cases.  As we have already said  the basis of fixation of wages and dearness  allowance is  industry-cum-region.  Where there are a large number  of industrial  concerns of the same kind in the same region  it would be proper to put greater emphasis on the industry part of  the industry-cum-region principle as that would put  all concerns  on a more or less equal footing in the  matter  of production costs and therefore in the matter of  competition in  the market and this will equally apply to  clerical  and subordinate staff whose wages and dearness allowance also go into calculation of production costs.  But where the  number of  comparable concerns is small in a particular region  and therefore  the  competition  aspect  is  not  of  the   same importance,  the  region  part  of  the  industry-cum-region formula   assumes  greater  importance   particularly   with reference  to  clerical and subordinate staff and  this  was what  was  emphasised in the French Motor Car  Co.’s  case() where  that company was already paying the highest wages  in the particular line of business and therefore comparison had to be made with as similar concerns as possible in different lines of business for the purpose of fixing wage-scales  and dearness  allowance.  The principle therefore which  emerges from  these two decisions is that in applying the  industry- cum-region  formula  for  fixing wage  scales  the  Tribunal should  lay  stress on the industry part of the  formula  if there  are  a large number of concerns in  the  same  region carrying on the same industry; in such a case in order  that production  cost may not be unequal and there may  be  equal competition, wages should generally be fixed on the basis of the  comparable industries, namely, industries of  the  same kind.   But where the number of industries of the same  kind in a particular region is small it is the region part of the industry-cum-region formula which (1) [1963] Supp. 2s C.R. 16. 369 assumes importance particularly in the case of clerical  and subordinate  staff, for, as pointed out in the French  Motor Car  Co.’s case,(" there is not much difference in the  work of this class of employees in different industries.  In  the present  cases it does appear that the Tribunal  has  leaned

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more  on the region part of the industry-cum-region  formula and less on the industry part.  But we think that it  cannot be  said  that the Tribunal was wrong in doing  so  for  two reasons.   In the first place these four companies  are  not engaged  in  the same line of industry; but  on  account  of certain  circumstances, namely, that Greaves Cotton and  Co. is  the controlling company of the other three, it has  been usual  to keep the same scales for clerical and  subordinate staff in all these concerns.  In the second place, it is not clear,  as  was clear in the Hindusthan Motors  case("  that there are a large number of comparable concerns in the  same region.   As a matter of fact the main company out of  these four is Greaves Cotton and Co. Limited, which is in the main an  investment  and financial company and the  Tribunal  was therefore  right in taking for comparison such companies  as would stand comparison with the main company in the  present appeals (namely, Greaves Cotton & Co). Both  parties filed scales of wages prevalent in  what  they considered  to be comparable concerns and it is  clear  from the  documents  filed that some of the  comparable  concerns were the same in the documents filed by the two parties.  On the  whole therefore we do not think the Tribunal was  wrong in   putting   emphasis  on  the  region   aspect   of   the industry-cum-region  formula in the present case insofar  as clerical and subordinate staff was concerned., for the  four companies  before us do not belong to the same industry  and Greaves   Cotton   and  Co.  controls   the   other   three. Considering  therefore  the  standing of  the  main  company (namely,  Greaves Cotton and Co. Ltd.), it was not  improper for  the  Tribunal  in  the present cases  to  rely  on  the comparable concerns (1) [1963] Supp. 2 S.C.R. 16 1/SCI/64 --- 24 (2) [1962] 2 L.L.J. 352. 370 which were cited on behalf of the respondents, some of which were common with the comparable concerns cited on behalf  of the  appellants.   What the Tribunal lid thereafter  was  to consider the minimum for various categories of clerical  and subordinate staff prevalent in these comparable concerns and the   maximum  prevalent  therein  at-id  also  the   annual increments and the span of years in which. the maximum would be  reached.   The Tribunal then went on to fix  scales  for various categories of clerical and subordinate staff of  the appellants which were in-between the scales found in various concerns.   Further,  as  the  financial  capacity  of   the appellants  was  not disputed, the  Tribunal  pitched  these scales  nearer  the highest scales taking into  account  the fact  that  for  nine years after 1950  there  had  been  no increase in wage scales.  We do not think therefore that the wage sales fixed by the Tribunal, learning as it did, on the region  aspect of the industry-cum-region formula,  for  the clerical and subordinate staff can be successfully  assailed by the appellants. It  has  however  been urged that  the  Tribunal  overlooked considering  what would be the total wage  packet  including basic  wages  and dearness allowance and that has  made  the total  wages (i.e. basic wage and dearness allowance)  fixed by  the Tribunal much higher in the case of  the  appellants than in comparable concerns which it took into account.   It is  true that the Tribunal has not  specifically  considered what  the  total wage packet would be on the  basis  of  the scales  of  wages and dearness allowance fixed by it  as  it should have done; but considering that wage scales fixed are less than the highest in the comparable concerns though more

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than  the  lowest,  it cannot be said that  the  total  wage packet  in the case of the appellants would ’be  necessarily higher  than in the case of the other  comparable  concerns. This will be clear when we deal with the dearness  allowance which  has  been fixed by the Tribunal, for it  will  appear that  the  dearness allowance fixed is more or less  on  the same lines, i.e. less than 371 the  highest  but more than the lowest in  other  comparable concerns.   On this basis it cannot be said that  the  total wage packet fixed in these concerns would be the highest  in the   region.   Though  therefore  the  Tribunal   has   not specifically  considered this aspect of the matter which  it should  have  done  its  decision  cannot  be   successfully assailed  on the ground that the total wage packet fixed  is the highest in the region. This  brings us to the case of factory-workmen.  We  are  of opinion  that  there  is  force in  the  contention  of  the appellants  insofar  as  the  fixation  of  wagescales   for factory-workmen  is concerned.  The respondents wanted  that separate wages should be fixed for each category of workmen. The Tribunal however rejected this contention and held  that the  usual  pattern of’ having unskilled,  semi-skilled  and skilled  grades should be followed and the various  workmen, though they should be known by their designation and not  by the class in which they were being placed, should be  fitted in  these categories.  In the present concerns,  there  were six  categories  from  before, namely  (i)  unskilled,  (ii) semiskilled  1,  (iii) semiskilled If, (iv) skilled  1,  (V) skilled  11, and (vi) skilled 111.  The Tribunal kept  these categories  though it introduced a seventh  category  called the  higher  unskilled.  It is not seriously  disputed  that this  category  of  higher  unskilled  does  not  exist   in comparable concerns; nor have we been able to understand how the  unskilled category can be sub-divided into two  namely, lower  and  higher unskilled, though we can  understand  the semi-skilled  and  skilled  categories  being   sub-divided, depending  upon the amount of’ skill.  But there  cannot  be degrees  of  want of skill among the unskilled  class.   The Tribunal  therefore was not justified in creating the  class of higher unskilled.  It is neither necessary nor  desirable to  create  a  higher unskilled category and  only  the  six categories which were prevalent from before should continue. The  main  attack of the appellants on the wages  fixed  for these six categories is that in doing so, the 372 Tribunal completely overlooked the wages prevalent for these categories  in concerns which it had considered  comparable. A  look at the award shows that it is so.  The Tribunal  has no  where considered what the wages for these categories  in comparable  concerns  are,  though  it  appears  that   some exemplars  were  filed before it; but the way in  which  the Tribunal has dealt with the matter shows that it paid  scant regard to the exemplars filed before it and did not care  to make  the comparison for factory-workmen in the same way  in which  it had made comparison for clerical  and  subordinate staff.   In  these  circumstances,  wage-scales  fixed   for factory-workmen must be set aside and the matter remanded to the Tribunal to fix wage-scales for factory-workmen dividing them into six categories as at present and then fixing  wage after  taking  into account wages  prevalent  in  comparable concerns.   The parties will be at liberty to  lead  further evidence in this connection. Then we come to the question of dearness allowance.  So  far as clerical staff is concerned, dearness allowance prevalent

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in  the appellants’ concerns was as follows on the  cost  of living index of 411-420:- Basic salary    D.A at cost of            Verification for in Rs.          living index              every 10 point                 group 411-420             movement 1 to 100     115% of basic salary           5%              or the textile scale              on 30 day month which              ever is higher 101 to 200        35%                       1 1/2% 201 to 300        25%                       1% 301 and above     17 1/2%                   3/4% 373 The Tribunal fixed the dearness allowance as follows:-                  When the consu-         Variation for Salary slab      mer price index         each 10 point rise                  is between 411.        or fall in the                  420                       index On 1st Rs. 100   115%                        5% On 2nd Rs. 100   50%                         2.% On 3rd Rs. 100   25%                         1%. Balance upto     20%                         1.%      Rs. 600 A  comparison of these figures will show that on  the  first hundred and the third hundred there is no difference in  the scale  fixed  by  the  Tribunal;  but  there  is  a   slight improvement  on  the second hundred and a  very  slight  one above three hundred.  This scale fixed by the Tribunal is in line  with some scales of dearness allowance recently  fixed by Tribunals in that region.  The main improvement is on the second  hundred and it cannot really be said that  employees in that wage range do not require the higher relief  granted to  them by tribunals in view of the rise in prices.  We  do not think therefore that the dearness allowance fixed by the Tribunal, taking into account what was already prevalent  in these  concerns  and also taking into account the  trend  in that region, can be successfully assailed so far as clerical staff’ is concerned. This brings us to the case of subordinate staff.  It appears that  in  these  concerns,  subordinate  staff  was  getting dearness  allowance  on different scales based  on  the  old textile  scale of dearness allowance.  The Tribunal has  put the  subordinate  staff  in  the  same  scale  of   dearness allowance  as  clerical staff.  The reason given by  it  for doing  so  is that incongruity in the  payment  of  dearness allowance  between clerical and subordinate staff should  be removed.  It appears that on account of different scales of 374 dearness  allowance  for subordinate and  clerical  staff  a member  of  ’the subordinate staff drawing  the  same  wages would  get  less  dearness allowance than a  member  of  the clerical staff.  The discrepancy is very glaring as  between clerical  staff and factory-workmen who also have  different scales  of  dearness  allowance.   The  Tribunal   therefore thought that dearness allowance which is meant to neutralise the  rise  in  cost of living, should be  paid  to  clerical staff,  subordinate staff as well as factory workmen on  the same  scale, for the need for neutralisation  was  uniformly felt by all kinds of employees.  It also pointed that  there was  a trend towards uniformity in the matter of  scales  of dearness allowance as between clerical staff and other staff and factory workmen and referred to a number of firms  where same  scales  prevailed for all the staff.  It  has  however been  urged on behalf of the appellants that the pattern  in the  region is that there are different scales  of  dearness

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allowance  for  clerical  staff and  other  staff  including factory  workmen  and  the Tribunal  therefore  should  have followed  this pattern.  The reasons given by  the  Tribunal for giving the same scales of dearness allowance to all  the categories of staff, including the factory-workmen appear to us  to be sound.  Time has now come when  employees  getting same   wages   should  get  the  same   dearness   allowance irrespective  of  whether  they are working  as  clerks,  or members  of  subordinate  staff  or  factory-workmen.    The pressure  of high prices is the same on these various  kinds of employees.  Further subordinate staff and factory workmen these days are as keen to educate their children as clerical staff and in the circumstances there should be no difference in  the  amount of dearness allowance between  employees  of different  kinds  getting same wages.  Further  an  employee whether  he is of one kind or another getting the same  wage hopes  for the same amenities of the and there is no  reason why  he  should  not get them, simply  because  he  is,  for example, a factory workman, though he may be coming from the same class of people as a member of clerical staff.  On  the whole therefore the Tribunal was in 375 our  opinion right in following the trend that has begun  in this  region  and  in  fixing the  same  scale  of  dearness allowance  for subordinate staff and factory workmen  as  in the case of clerical staff.  So far therefore as subordinate and  clerical  staff  are concerned, we  see  no  reason  to disagree  with the rate of dearness allowance fixed  by  the Tribunal. This  brings  us to the case of the dearness  allowance  for factory-workmen.  In their case we have set aside the  award relating  to wage scales.  It follows that we must also  set aside  the award relating to dearness allowance as  we  have already  indicated  that  the  Tribunal  has  to  take  into consideration  the  total  pay packet in  fixing  wages  and dearness  allowance.  When therefore the case goes  back  to the  Tribunal  for fixing wages and dearness  allowance  for factory-workmen, it will be open to the Tribunal to fix  the same rates of dearness allowance for factory workmen as  for clerical  staff;  but  in doing so the  Tribunal  must  when making  comparisons take into account the total wage  packet (i.e. basic wages fixed by it as well as dearness allowance) and then compare it with the total wage packet of comparable concerns  and thus arrive at a just figure for  basic  wage, for each category of factory-workmen.  But the entire matter is left to the Tribunal and it may follow such method as  it thinks best so long as it arrives at a fair conclusion after making the necessary comparison. This  brings  us  to the question of  adjustment.   We  have already  said  that  the  Tribunal  allowed  one  to   three increments depending upon the length of service between 1950 and 1959.  It has been urged that no adjustment should  have been  allowed taking into account the fact that  incremental scales  were in force previously also in these concerns  and the Tribunal has increased both the minimum and the  maximum in  its  award and has granted  generous  annual  increments reducing  the total span within which a particular  employee belonging  to clerical and subordinate staff will reach  the maximum.  Reliance in this connection has been placed on the 376 French  Motor  Car  Co.’s  case (".  It  is  true  that  the Tribunal has given larger increments thus reducing the  span of years for reaching the maximum.  That alone however is no reason for not granting adjustment.  But it is said that  in the  French Motor Co. case(’-’, this Court held  that  where

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scales of pay were existing from before no adjustment should be granted by giving extra increments and that case  applies with  full force to the facts of the present case.   Now  in that  case  this Court pointed out on a review  of  a  large number  of awards dealing with adjustments  that  "generally adjustments  are granted when scales of wages are fixed  for the first time.  But there is nothing in law to prevent  the industrial   tribunal  from  granting  adjustments  to   the employees  in the revised wage scales even in a  case  where previously pay-scales were in existence; but this has to  be done  sparingly  taking  into consideration  the  facts  and circumstances  of each case.  The usual reason for  granting adjustment even where wage-scales were formerly in existence is  that the increments provided in the  former  wage-scales were  particularly low and therefore justice  required  that adjustment should be granted a second time." Another  reason for  the same was that the scales of pay were also low.   In those   circumstances  adjustments  have  been  granted   by tribunals  a  second time.  This Court then pointed  out  in that  case  that the incremental scales  prevalent  in  that company  were  the  highest for that kind  of  industry  and therefore  struck down the adjustments granted  and  ordered that clerical staff should be fixed on the next higher  step in the new scales if there was no step corresponding to  the salary  drawn  by a clerk in the new  scale.   The  question therefore  whether  adjustment should be granted or  not  is always a question depending upon the facts and circumstances of each case. Let  us therefore see what the circumstances in the  present cases  are.  Tables of comparative rates of increments  were filed before the Tribunal (1)  [1963] Supp. 2 S.C.R. 16. 377 for  various  grades  of  clerks.   It  is  clear  from  the examination of these tables and pay-scales prevalent in  the appellants’ concerns from 1950 that pay scales were not high as  compared  to  pay scales  in  comparable  concerns.   If anything,  they  were  on  the low  side.   Further,  as  an example,  in  the case of junior clerks, the first  rate  of increment  was  Rs. 5 in the appellants’ concerns  and  this rate went on for 13 years; in other concerns where the first rate  of  increment was Rs. 5 it lasted for a  much  shorter period,  which  in no case exceeded eight years and  was  in many cases three or four years.  In some concerns the  first rate of increment was higher than Rs. 5. Almost similar  was the  case  with senior clerks.  So it appears  that  in  the appellants’  concerns  the  first  rate  of  increment   was generally  on  the low side and lasted for a  longer  period than   in  the  case  of  comparable  concerns.   In   these circumstances if the Tribunal decided to give increments  by way of adjustments it cannot be said that the Tribunal  went wrong.   The  facts ’in these cases are different  from  the facts in the case of the French Motor Car Co.’s case(2)  and therefore  (1)  we see no reason for  interfering  with  the order of adjustment.  After the change in wage-scales, dear- ness   allowance  and  adjustment,  the  employees  of   the appellants’ concerns will stand comparison with some of  the best concerns in that region.  But considering that there is no  question of want of financial capacity and that  Greaves Cotton  & Co. which is the main company concerned  in  these appeals, has a high standing in that region, we do not think that  the  total  wage  packet  fixed  is  abnormal  or   so disproportionate  as  compared to the total wage  packet  in other  comparable concerns as to call for  any  interference with adjustments.

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The  next  question  is about  the  so-called  retrospective effect  of the award.  The first reference was made  to  the Tribunal  on April 8, 1959, while the last was  in  December 1959.   What the Tribunal has done is to  grant  wage-scales etc.,  from  April 1, 1959.  This cannot in our  opinion  be said to be really (1)[1963] Supp. 2 S.C.R. 16. 378 retrospective,  because it is practically from the  date  of the first reference in the case of the main company.  On the whole therefore we see no reason to interfere with the order of  the Tribunal fixing the date from which the award  would come into force. Lastly  we come to the question of gratuity.  The attack  in this  connection is on two aspects of the  gratuity  scheme. The first is about the fixation of 20 months as the  maximum instead of’ 15 months, which was usual so far, The second is with  respect to deduction from gratuity only to the  extent of  the financial loss occasioned by misconduct in  case  of dismissal for misconduct.  So far as the second provision is concerned  it  cannot  be disputed that this  is  the  usual provision that is being made in that region.  So ear as  the increase  in  the  maximum from 15 months to  20  months  is concerned,  it  appears that the Tribunal has  relied  on  a number of cases in which the maximum is higher than  fifteen months wages.  In these circumstances considering that  tri- bunals  have now begun to, give a higher ceiling and in  one concern,  namely Mackinnon Mackenzie, the ceiling  has  been fixed  even so high as thirty moths by agreement, we do  not think  that  any interference is called for in  the  present case. We  therefore  dismiss the appeals so far  as  retrospective effect  and  adjustments  as  also  fixation  of  wages  and dearness allowance with respect to clerical and  subordinate staff  are concerned.  We allow the appeal with  respect  to factory-workmen and send the cases back to the Tribunal  for fixing the wage structure including basic wage and  dearness allowance  and for granting adjustments in the light of  the observations  made  by us.  The new award pursuant  to  this remand will also come into force from the same date, namely, April  1,  1959.  The appeals with respect to  gratuity  are dismissed.   In the circumstances we order parties  to  bear their own costs.Two months from today is allowed to pay up the arrears. Appeal partly allowed and remanded. 379