http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 13  

PETITIONER: PHILIPS INDIA LTD.

       Vs.

RESPONDENT: LABOUR COURT, MADRAS & ORS.

DATE OF JUDGMENT26/03/1985

BENCH: KHALID, V. (J) BENCH: KHALID, V. (J) DESAI, D.A.

CITATION:  1985 AIR 1034            1985 SCR  (3) 491  1985 SCC  (3) 103        1985 SCALE  (1)592  CITATOR INFO :  RF         1992 SC   1  (64)

ACT:      The Tamil  Nadu Shops  and  Establishments  Act,  1947, Sections 14(1)  and 31,  interpretation of-Construction of a statutory  provision-Canon  of  construction  Ex  visceribus actus-Words and  phrases-Meaning of  "over  time",  no  such person", "such  establishment", "rate  of  overtime  wages", occurrirg  in   Section  14(1)  and  31-Where  the  employer prescribes working  hours less  than the maximum permissible in the statute, whether he is obliged to pay the statutorily prescribed rate and not the rates of overtime charges agreed upon, in  respect of  work done  in excess  of the number of weekly working  hours prescribed  by the  employer and up to the number  of statutorily permitted weekly working hours of 48 hours.

HEADNOTE:      Under  Section  14(1)  of  the  Tamil  Nadu  Shops  and Establishments  Act,   1947,  "no  person  employed  in  any establishment shall  be required or allowed to work for more than eight  hours in  any day forty-eight hours in any week, and under  Section 31",  where any  person employed  in  any establishment is  required to  work overtime,  he  shall  be entitled, in  respect of  such overtime  work, to  wages  at twice the ordinary rate of wages."      In  the  establishment  of  Philips  India  Ltd.  which switched over to five p days of week, with effect from March 29,1965 the total number of working hours per week was fixed at 39  hours with  a daily  working hour of 7-3/4 hours from Monday through  Thursday and  8 hours on Friday. The company also Introduced  the rate  of overtime payment at 1 1/2 time the ordinary  wages for work done over and above the maximum number of  working hours  per week as well as for working on holidays. This  rate was  admissible for  overtime work done beyond 39  hours  per  week  but  this  was  subject  to  an important condition  that whenever  the total  working hours exceed either  8 hours  per day  or 48  hours per  week, the employees were  entitled to  over time at twice the ordinary wages  as  mandated  by  Section  31  of  the  Act.  In  the establishment of  the State  Bank of India which is governed by the  Desai Award,  the daily working hours from Monday to

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 13  

Friday was  6-1/2 hours  a day  and  4  hours  on  Saturday, totaling  a  weekly  36-1/2  hours.  The  rate  of  overtime allowance was  1-1/2 times the wages for every quarter of an hour of  overtime work  done    for which payment have to be made, 492      Claim petitions  were filed by the employers of Philips India Ltd.,  and the  State Bank  of India  before different Labour Courts  under  Section  33(c)(2)  of  the  Industrial Disputes Act,  1947 inviting the Labour Court to compute the monetary benefits  in respect  of overtime allowance for the work done  beyond the  prescribed hours  of work per week in terms of  section 31  of the  Act. Their contention was that they were  entitled to  overtime wages at double the rate of ordinary wages  for work  done in  excess of 39 hours/36-1/2 hours a  week.      Though the  matters  were  before  two  operate  Labour Courts and  were decided  at different  intervals, both  the Labour Courts  held that  Section 14  of the  Act  does  not prescribe number  of working  hours per  day but  it  merely specified maximum  number  of  working  hours  that  can  be introduced by  an employer  in an  establishment governed by the Act.  But once the employer chooses to prescribe working hours per day or total number of working hours per week less than permissible  under section  14, the  rate  of  overtime allowance as prescribed in section 31 would be applicable to the workmen  notwithstanding the  fact that  the  prescribed number of  working hours  per day or total number of working hours per  week were less than the maximum which the statute permitted. Accordingly, both the Labour Courts  computed the monetary benefits by granting overtime allowance at the rate of double the ordinary wages and the difference between what was paid  by the  employer in  each case  at 1-l/2 times the ordinary wages  and what  became payable  as per  the Courts order was directed to be paid to each employee,      Aggrieved thereby the company and the Bank filed in all five writ  petitions questioning the correctness of the said decision, Due  to a  conflict of  opinion in  the matter  of interpretation  of   Sections  14  and  31  by  two  earlier decisions of the Madras High. Court, the matter was referred to a Division Bench, The High Court called in aid Section 50 of the  Act to  observe  that  if  the  existing  right  and privileges of  an employee  in any  establishment  are  more favourable to  him than  those created  by the Act, the same were  preserved   and  held;  (i)  that  once  the  employer prescribed daily  working hours as well as the weekly total, work rendered  in excess  of the  proscribed  working  hours would    constitute  overtime  work  and  when  the  statute prescribes the  rate of overtime work, it is obligatory upon the employer  to make  payment at  the statutory  rate, (ii) that even  if Section  14(1) was  interpreted as prescribing normal working  hours and  that work in excess of the normal working hours  so prescribed would constitute overtime which would attract  Section 31,  yet once the employer prescribed hours less  than the  statutorily permissible working hours, any work  done beyond  the prescribed working hours would be overtime work  and the  rate  of  overtime  work  should  be governed  by   Section  31   of  the  Act,  The  High  Court accordingly dismissed all the petitions.      Hence the appeals by special leave,      Allowing the appeals, the Court ^      HELD:1.1  A  bare  perusal  of  Section  14(1)  of  the Tamilnadu Shops 493

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 13  

and Establishment Act, shows that it prescribes a ceiling on working hours.  Obviously, it  cannot be interpreted to mean that the  employer must  provide maximum  number of  working hours as  therein set  out in  the establishment governed by the Act.  It is  open to  the employer  to prescribe working hours for a day and total number of working hours for a week less than  the ceiling prescribed by the statute. Section 14 puts an embargo on the employers’ right to prescribe working hours beyond  therein prescribed  subject  however,  to  its liability to  pay higher rate of wages for the overtime work done. [500B-C]         1.2 The proviso to Section 14(1) makes it very clear that the  upper limit fixed by the substantive provision can be exceeded  up to  the ceiling fixed by the proviso and not beyond in any case. This is a prohibition in public interest for safeguarding  the health which may be adversely affected by fatigue,  stress and  strain consequent  upon  continuous work daily  or for  total number  of hours  in a  week. This simultaneously  ensures   a  weekly  off  day  even  if  the employer prescribes  number of  working hours as provided in Section 14(1).                                                     [500D-E]      1.3 Section 14(1) upon its true construction permits an employer to  prescribe daily  working hours  not exceeding 8 hours a  day and  total number  of working  hours at 48 in a week. By  the proviso  the employer can take ; overtime work and that  the bar  imposed by  sub-section (1) of Section 14 may be  breached to  the extent  provided in the proviso, if the working  hours do  not exceed  10 hours  in any  day and total number of working hours at 48 in a week. 8 hours a day and 48  hours in  a week  would  constitute  normal  working hours. Anything in excess of 8 hours a day but not exceeding 10 hours  a day  and 48  hours a  week and  not exceeding 54 hours a week will constitute overtime. [500E-G]      2.1 The  expression used  in Section  14(1) is "no such person" meaning  thereby that  person, who would be required to work  8 hours a day or 48 hours a week, may be allowed to work in  excess of that limit subject to payment of overtime wages. [500H]      2.2 The  expression "such  person" in  the  proviso  to Section 14  refers to  person who  is required to work for 8 hours a day and 48 hours a week.                                                       [502B]      2.3 The  expression "such establishment" in the proviso to Section  14 would  indicate that  establishment which has prescribed the  working hours as set out in the main part of the section  namely, 8  hours a day and 48 hours in  a week. In such  an establishment  overtime work  for such  a person would only  be that  work which  would be  done in excess of either 8  hours a day or 48 hours a week. Such overtime work has to  be compensated  at twice  the ordinary rate of wages prescribed in Section 31. [502C-D]      2.4 The  expression "such  overtime" can  refer to  one contemplated by  the proviso  to Section 14(1? and no other. Reading Sections 14 and 31 together 494 a scheme  emerges. The  statute first puts an embargo on the power of  the employers  to prescribe  normal working hours, not exceeding  8 hours  per day  and 48  hours per week. The proviso makes  it obligatory  to pay overtime wages for work in excess  of the  prescribed hours  as set  out in  Section 14(1).                                                     [502D-E]      2.5 The  employer would  ordinarily prescribe wages for normal working  hours. Once  the wages  for  normal  working

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 13  

hours per  day and  cumulative for  the week  or  month  are prescribed, they  would be styled as ordinary rate of wages. Thus the  employer will  be liable  to pay  to the  employee wages at  the ordinary rate of wages for prescribed hours of work as  permissible in  Section 14(1) and whenever he takes work in  excess of the prescribed hours of work the rate for overtime work  prescribed by Section 31 would come into play [502F-G]      3.1 The  canon of  statutory construction  is that  the statute must  be read  as a  whole. This  is a  general rule applicable to  all statutes  and known  as "construction  ex visceribus actus or the "elementary rule" or "settled rule". The only recognised exception to this well-laid principle is that it cannot be called in aid to alter the meaning of what is of itself clear and explicit.                                                     [503A-B]      Attorney General  v. HRH Prince Earnest Augusts, [1957] 1 All E.R. 497 quoted with approval.      Poppatlal Shah  v. State  of Madras,  [1953]  SCR  677; Punjab Beverages  Pvt. Ltd. v Suresh Chand, [1978] 3 SCR 370 referred to.           It is undoubtedly true that Section 14(1) does not prescribe normal hours of work but merely puts an embargo on the employers’  right to prescribe daily and weekly hours of work beyond  permissible under  the statute.  But where  the statute itself  prescribes such permission hours of work and also  makes   it  obligatory   to  pay  overtime  wages  and prescribes rates,  it can  only mean  work in  excess of the maximum hours  of work  permissible under  the statute which alone would  attract the  rate of  payment for overtime work "Such overtime work" in Section 31 would and would only mean overtime as understood in the proviso to Section 14(1) which has  reference   to  maximum  hours  of  work  permitted  by Section14(1). This  is how  the statute  has to be read as a whole.                                                     [506D-F]           3.3 Applying this well-laid canon of construction, the expression "rate of overtime wages" in Section 31 has to be understood  and interpreted in the light of the provision contained  in  Section  14(1)  read  with  its  proviso.  By reference to  the statutory  provisions  and  unhampered  by precedents, it  becomes clear that when normal working hours as  permitted   by   Section   14(1)   are   prescribed   by establishment for his employees working in the establishment to which  the Act  applies, wages for work in excess of such prescribed hours  of work  will have  to be paid at the rate prescribed in Section 31. The framers of the 495 statute provided  the  whole  scheme  by  first  putting  an embargo on  the maximum   number of working house payable at ordinary rates  and then  permitting overtime work up to the ceiling, simultaneously making it obligatory to pay overtime wages at the rate prescribed in the very statute. [503D-F]      3.4 Where the employer prescribed working hours per day or total  number of  hours of  work per  week less  than the maximum permissible under the statute, in the absence of the definition of that term in the Act, any work taken in excess of the  prescribed hours  of work would be overtime work and the employer  would be  liable to  pay some compensation but not necessarily  the statutory  compensation which  would be attracted only when the employer takes work in excess of the maximum hours  of work  prescribed by the statute. In such a situation the  rate of  wages payable  would be  as to  what ought to  be the  rate of wages payable. Such a rate must be the subject  matter of  agreement between  the parties or an

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 13  

award by  industrial adjudication.  Any  work  taken  for  a period in  excess  of  the  maximum  permissible  under  the statute would  indisputedly attract  the statutory  rate  of overtime of wages.                                               [506G-H; 507D]      Indian Oxygen  Ltd. v. Their workmen, [1969] I SCR 550, explained and relied on.      A.K Basu v. ICI (India) Pvt. Ltd. and Ors. [1975] 1 LLJ 239, (Calcutta);  M/s Carew  & Co.  Ltd.  v.  Sailaja  Kanti Chatterjee and Anr. [1972] 11 LLJ 359, (Calcutta) overruled.

JUDGMENT:      CIVIL APPELLATE JURISDICTION Civil Appeal Nos. 833_34 & 835-837 (NL) of 1976.      From the  Judgement and  Order dated  4. 4. 1974 of the Madras High  Court in  Writ Petitions  Nos.  2827,  2828/72, 1006, 1007/71.      F.S. Nariman, D.N. Gupta and S. Ramasubramanium for the Appellants.      M.K. Ramamurthy,  J. Ramamurthy  and Ambrish  Kumar for the Respondents.      The Judgment of the Court was delivered by      KHALID, J.  What is  the  rate  of  overtime  allowance admissible to  the employees  of the  two appellants working their establishments  situated in the State of Tamil Nadu is the only question raised in these appeals by special leave ? 496      (2) M/s  Philips India  Ltd-the appellant  in the first batch of  appeals-a company incorporated under the Companies Act has  an establishment  in the  State of Tamil Nadu. This establishment is  governed  by  The  Tamil  Nadu  Shops  and Establishments Act, 1947 (’Act’ for short). According to the practice followed  by the  company,  the  employees  of  the establishment had  to render  service for  39 hours  a week, made up  of 7  hours per  day from  Monday to Friday and 4 - hours on  Saturday. Effective  from March 29, 1965, when the company switched  over to  five days week, it still retained the total  number  of  working  hours  per  week  at  39  by extending the working hours from Monday to Thursday at 7-3/4 hours and  8 hours  on Friday.  Thus the total working hours per  week   remained  constant   at  39.  The  company  also introduced the  rate of  overtime payment  at 1-1/2 time the ordinary wages  for work  done over  and above  the  maximum number of  working hours  per week as well as for working on holidays. This  rate was  admissible for  overtime work done beyond 39  hours  per  week  but  this  was  subject  to  an important condition   that  whenever the total working hours exceed either  8 hours  per day  or 48  hours per  week, the employees were  entitled to  overtime at  twice the ordinary wages as mandated by Sec. 31 of the Act.      (3)  State  Bank  of  India  (’Bank’  for  short),  the appellant in  the second  batch of  appeals,  paid  overtime allowance at the rate as  awarded by the National Industrial Tribunal (Bank Disputes) popularly known as Desai Award. The Tribunal fixed the working hours not exceeding 6-1/2 hours a day from Monday to Friday and not excluding 4 hours a day on Saturday. After  thus fixing  working hours  at  36-1/2  per week, the Tribunal proceeded to give direction about rate of overtime allowance  admissible to  the employees governed by award. Modifying  the rates as awarded by the Shastri Award, the Tribunal  directed that  the rate  of overtime allowance would be  1-1/2 times the wages as explained in the relevant portion of  the award  for  every  quarter  of  an  hour  of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 13  

overtime work  done for  which payment  has to be made. (See Para 10.46 of the Desai Award).      (4) 11  employees of  the company  filed Claim Petition No. 329/71  in the Labour Court at Madras under Sec. 33-C(2) of the  Industrial Disputes  Act, 1947 (I.D. Act for short), inviting the Labour Court to compute the monetary benefit in respect of  overtime allowance  for the work done beyond the prescribed hours  of work  n per week as provided in Sec. 31 of the Act. In other words, they claimed that in view of the provision contained in Sec. 31 of the Act, 497 the employees of the company working in the establishment at Madras are  entitled to overtime wages at double the rate of ordinary wages  for work done in excess of 39 hours per week and not  at 1-1/2  times the  rate of  ordinary wages  as is being done by the company.      (5) Another  Claim Petition  No. 306/71  was moved  for identical relief by some other employees of the company.      (6) Similarly  three employees  of the  State  Bank  of India filed  three separate Claim Petition Nos. 19,20 and 21 of 1964  before the  Central Government Labour Court, Madras praying for  incidental relief  on almost identical grounds. In other  words, they  claimed overtime  wages at double the rate of ordinary wages as prescribed in Sec. 31 of the Act.      (7) Though  the matters were before the separate Labour Courts and  were decided  at different  intervals, both  the Labour Courts  held  that  Sec.  14  of  the  Act  does  not prescribe number  of working  hours per  day but  it  merely specifies maximum  number  of  working  hours  that  can  be introduced by  an employer  in an  establishment governed by the Act.  But once the employer chooses to prescribe working hours per day or total number of working hours per week less than  permissible  under  Sec.  14,  the  rate  of  overtime allowance as  prescribed in  Sec. 31  would be applicable to the work-  men notwithstanding  the fact that the prescribed number of  working hours  per day or total number of working hours per  week were less than the maximum which the statute permitted. Accordingly,  both the Labour Courts computed the monetary benefit  by granting overtime allowance at the rate of double the ordinary wages and the difference between what was paid  by the  employer in  each case  at 1-1/2 times the ordinary wages  and what  became payable  as per  the Courts order was directed to be paid to each employee.      (8) The  Bank and  the company  filed in  all five writ petitions questioning  the correctness  of  the  two  common orders made  by the two Labour Courts, under Art. 226 of the Constitution in  the High Court of Judicature at Madras. All the five  writ petitions  came up  before a  learned  Single Judge of  the Madras  High Court who was of the opinion that there was  a conflict  in the  matter of  interpretation  of Secs. 14  and 31  of the  Act in  two decisions  of the same court being  (i) Railway Employees & Co. v. Labour Court (1) and (ii) K.P.V. Shaik (1)  (1960) II LLJ 215. 498 Mohd. Rowther  & Co.  v. KS.  Narayanan (1) and therefore he referred the  petitions to  a Division  Bench. All  the writ petitions were  accordingly heard by a Division Bench of the same High Court.      (9) The  High Court  took notice  of the t‘act that the Act does  not define  overtime work  which according  to the High Court  means  work done beyond the normal working hours in any  establishment to  which the  Act applies.  The  High Court then  proceeded to  observe that  the proviso  to Sec. 14(1) only lays down that overtime wages may be paid for the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 13  

work done  in excess  of the  normal working hours. The High Court then  held that  once the  employer  prescribed  daily working hours as well as the weekly total, work rendered  in excess of  the prescribed  working  hours  would  constitute overtime work  and when  the statute  prescribes the rate of overtime work,  it is  obligatory upon  the employer to make payment at the statutory rate. Sec. 50 of the Act was called in aid to observe that if the existing rights and privileges of an  employee in  any establishment are more favourable to him than those created by the Act, the  same were preserved. Accordingly, it  was  held  that  even  if  Sec.  14(1)  was interpreted as  prescribing normal  working hours  and  that work in  excess of  the normal  working hours  so prescribed would constitute  overtime which  would attract Sec. 31, yet once the employer prescribed hours less than the statutorily permissible    working  hours,  any  work  done  beyond  the prescribed working hours would be overtime work and the rate of overtime  work should  be governed by Sec. 31 of the Act. The High Court accordingly discharged the rule and confirmed the orders  made by  both Labour Courts, Hence these appeals by special leave.      (10) It is not in dispute that the working hours in the Bank were  governed by  Desai Award.  So also  the  rate  of overtime allowance  was governed by the Desai Award till the Labour Court  ruled to  the contrary  Similarly, the company had prescribed  its own  working hours  and provided for its own rate  of payment  for overtime  work and the payment was made accordingly till the  Labour  Court ruled to the contrary. It is of importance to note that in both the cases the working hours were less than one maximum  permissible under  Sec. 14  of the  Act. It  is equally important  to note  that the  rates of  payment  for overtime work  in both the establishments prescribed by them were for  the period of overtime work in excess of their own prescribed working hours and up to the (1)  (1972) 11 LLJ 385 499 statutory limit  prescribed in  Sec 14  of the  Act.  It  is admitted  that   where  the   overtime  work   exceeded  the statutorily  prescribed  limit,  the  rate  of  payment  for overtime work  was the one statutorily prescribed in Sec. 31 of the  Act. Therefore,  the Contours of controversy is on a correct interpretation  of the  relevant provisions  of  the Act, what would be the rate of overtime allowance admissible to the  employees of  the establishments  of the employer in each case  situated in  Tamil Nadu  State for  overtime work done in  excess of the prescribed number of working hours by the  employer   and  up  to  the  number  of  working  hours statutorily permitted.  Tn other words, what ought to be the rate of overtime allowance for the work done in excess of 39 hours per week in the case of the company and 36 1/2 G hours per week in the case of the Bank and up to 48 hours per week in each case.      (11)  At   the  outset   let  us  notice  the  relevant provisions of the Act. Sec. 14 provides for daily and weekly hours of work. It reads as under:      "14. Daily  and weekly hours of work-(I) Subject to the      provisions of  this Act,  no  person  employed  in  any      establishment shall  be required or allowed to work for      more than  eight hours in any day and forty-eight hours      in any week:           Provided that  any such  person may  be allowed to      work in  such establishment for any period in excess of      the limit  fixed  under  this  sub-section  subject  to      payment of  overtime wages,  if  the  period  of  work,

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 13  

    including overtime  work, does  not exceed ten hours in      any day  and in  the aggregate  fifty-four hours in any      week."           Sec. 31  prescribes rate  of‘ wages  for  overtime      work. It reads as under:           "31. Wages  for overtime  work -Where  any  person      employed in  any  establishment  is  required  to  work      overtime, he   shall  be entitled,  in respect  of such      overtime work,  to wages  at twice the ordinary rate of      wages.           Explanation-For the  purpose of  this section, the      expression "ordinary  rate of  wages ’shall  mean  such      rate of  wages as  may be   calculated  in  the  manner      prescribed.’ 500      (12) The  first  question  which  we  must  engage  our attention is:  whether Sec.  14 upon its true interpretation prescribes daily  working hours  in an establishment as also total number of working hours per week for which work may be taken in  any week  without incurring  the liability  to pay higher rate  of wages  for overtime  work.A bare  perusal of Sec. 14(1)  would show  that it  prescribes   a  ceiling  on working hours.  Obviously, it  cannot be interpreted to mean that the  employer must  provide maximum  number of  working hours as  therein set  out in  the establishment governed by the Act.  It is  open to  the employer  to prescribe working hours for a day and total number of working hours for a week less than  the ceiling  prescribed by  the statute.  Sec. 14 puts an  embargo on  the    employers  ’right  to  prescribe working hours  beyond therein prescribed subject however, to its liability  to pay  higher rate of wages for the overtime work done. The proviso however, makes it very clear that the upper limit  fixed  by  the  substantive  provision  can  be exceeded up  to the  ceiling fixed  by the  proviso and  not beyond in   any  case.  This  is  a  prohibition  in  public interest for  safeguarding the health which may be adversely affected by  fatigue,  stress  and  strain  consequent  upon continuous work  daily or  for total  number of  hours in  a week. This  simultaneously ensures  a weekly off day even if the employer  prescribes number of working hours as provided in  Sec.   14(1).  Sec.   14(1)  therefore,  upon  its  true construction permits  an employer to prescribe daily working hours not  exceeding 8  hours a  day  and  total  number  of working hours  at 48 in a week. By the proviso, the employer can take  overtime work if the working hours do not exceed I hours in  any day  and 54 hours in a week, The proviso makes it abundantly  clear that  any work  taken in  excess of the working hours  prescribed in  the main part of sub-s. (I) of Sec. 14 would constitute overtime work. 8 hours a day and 48 hours in  a week  would  constitute  normal  working  hours. Anything in  excess of  8 hours  a day  but not exceeding 10 hours a day and 48 hours a week and not exceeding 54 hours a week will  constitute overtime work. This becomes clear from the language  used in  the proviso when it says that the bar imposed by  sub-s. (1)   of  Sec. 14  may be breached to the extent provided  in the proviso. The expression used is that no such  person meaning  thereby that  person, who  would be required to  work 8  hours a  day or 48 hours a week, may be allowed to  work in  excess of that limit subject to payment of overtime  wages. 8  hours a  day  and  48  hours  a  week constitute normal  time of  work at  ordinary wages  and any work in excess of the time prescribed for work would attract the liability 501 to pay overtime wages. Undoubtedly, the High Court was right

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 13  

in saying  that the  expression ’overtime’ is not defined in the Act  but when Sec. 14(1) prescribes permissible hours of work both  daily and  weekly and  makes it obligatory to pay overtime wages  for work  in excess of the permissible hours of work,  the expression  ’overtime’ renders  itself easy of understanding.  Overtime  work  attracts  the  liability  of paying overtime wages.      (13) ’Over’  is  a  prefix  qualifying  the  expression ’time’  which   is  well-understood.   ’Over’  as  a  prefix generally indicates  excessive  or  excessively;  beyond  an agreed  or   desirable  limit.   there  are  more  than  150 expressions to  which ’over’  is added as a prefix. One such expression  is   ’overtime’.  Collins   English   Dictionary reprinted and  updated in  1983 gives  the  meaning  of  the expression ’overtime’  as (i)  work at  regular job  done in addition to  regular working  hours........  (iii)  time  in excess of  a  set  period  ...............  (v)  beyond  the regular or  stipulated time (vi) to exceed the required time for (say  a  photographic  exposure).  Webster’s  Third  New International Dictionary gives the meaning of the expression ’overtime’ as  (i) time  beyond or in excess of a set limit; working time  in excess  of a  minimum total set for a given period; in  excess of  a set  time limit  or of  the regular working  time.   Therefore,  even   though  the   expression ’overtime’ is  not defined  in the  Act, its  connotation is unambiguous. In  no uncertain terms, it means in the context of working hours, period in excess of the prescribed working hours, -      (14) The  question really  is not what is understood by the expression  ’overtime’, but  what is the admissible rate of  payment  for  overtime  work.  If  the  statute  permits employment for  a  certain  number  of  hours  of  work  and mandates a  higher rate  of wages for work done in excess of the prescribed  hours of  work, obviously  every employer to whom the  Act applies will have to pay overtime wages at the rates prescribed  in the  statute. Accepting  what the  High Court has held that Sec. 14(1) merely prescribes the ceiling on working  hours and  casts an  obligation to  pay overtime wages as made obligatory in the proviso the question is what period of work shall be treated as overtime work so as to be able to  claim overtime wages at statutory rate. Keeping out of consideration  for  the  time  being  the  working  hours prescribed by  the two  appellants, take a case in which the working house  are prescribed  as permitted  by Sec.  14(1). Functionally translated if an establishment, has  prescribed working 502 hours as  permitted by  Sec. 14(1) i.e. 8 hours a day and 48 hours a  week, the  employees of such establishment would be entitled to overtime wages as directed by the proviso and at the rate  prescribed in  the statute.  To some  extent,  the proviso in  this case has made a positive specific provision simultaneously carving  out an  exception to Sec. 14(1). The proviso first  permits work  in  excess  of  the  prescribed number of  the hours  but it is hedged in with the condition to pay  overtime wages.  The expression ’such person’ in the proviso refers  to person  who is required to work for eight hours a  day and  forty-eight hours  a week.  The expression ’such establishment’  in the  proviso  would  indicate  that establishment which  has prescribed the working hours as set out in  the main  part of  the section namely, 8 hours a day and 48  hours in  a week.  In such an establishment overtime work for  such a  person would only be that work which would be done  in excess  of either  8 hours  a day  or 48 hours a week. Such  overtime work  has to be compensated at the rate

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 13  

prescribed in  Section 31  which  provides  that  there  any person employed  in an   establishment  is required  to work overtime, he  shall be  entitled in respect of such overtime work to  wages at  twice the  ordinary rate  of  wages.  The expression ’such  overtime’ can refer to one contemplated by the proviso  to Sec. 14(1) and no other. Reading sections 14 and 31 together, a scheme emerges. The statute first puts an embargo on  the power  of the  employers to prescribe normal working hours,  not exceeding  8 hours  per day and 48 hours per week.  The proviso  makes it  obligatory to pay overtime wages for  work in excess of the prescribed hours as set out in Sec.  14(1). Such  overtime work has to be compensated by payment of overtime wages. And the rate of overtime wages is prescribed in  Sec. 31 namely, at twice the ordinary rate of wages.   The employer  would ordinarily  prescribe wages for normal working  hours. Once  the wages  for  normal  working hours per  day and  cumulative for  the week  or  month  are prescribed, they  could be styled as ordinary rate of wages. Thus the  employer will  be liable  to pay  to the  employee wages at  the ordinary rate of wages for prescribed hours of work as permissible in Sec. 14(1) and whenever he takes work in    excess  of the  prescribed hours  of work the rate for overtime work  prescribed by  Sec. 31  would come into play. Secs. 14  and 31  provide the  whole scheme  of  prescribing normal hours  of work  to be  paid for  as ordinary rates of wages. They  permit the  employer to  take work in excess of the normal working house up to the ceiling as set out in the proviso to  Sec. 14(1)  which makes  it  obligatory  to  pay overtime wages  for work  in excess  of the  normal  working hours and the rate for the same is prescribed statutorily in Sec. 31. 503      (15)  No  cannon  of  statutory  construction  is  more firmly, established  than that the statute must be read as a whole. This  is a general rule of construction applicable to all statutes  alike which  is spoken  of as  construction ex visceribus actus.  This rule of statutory construction is so firmly  established   that  it   is  variously   styled   as ’elementary  rule’  (See  Attorney  General  v.  HRH  Prince Earnest Augustus  (1) and as a ’settled rule’ (See Poppatlal Shall  v.   State  of  -  Madras)(2).  The  only  recognised exception to  this well-laid  principle is that it cannot be called in  aid to  alter the  meaning of  what is  of itself clear and  explicit. Lord  Coke laid  down that:  ’it is the most  natural  and  genuine  exposition  of  a  statute,  to construe one  part of  a statute by another part of the same statute, for  that best  expresseth meaning  of the  makers’ (Quoted with  approval in  Punjab Breverages  Pvt.  Ltd.  v. Suresh Chand).(3)      (16) Applying  this well-laid  cannon of  construction, the expression ’rate of overtime wages’ in Sec. 31 has to be understood and  interpreted in  the light  of the  provision contained in Sec. 14(1) r read with its proviso.      (17) By  reference  to  the  statutory  provisions  and unhampered by  precedents, it becomes clear that when normal working hours  as permitted  by Sec. 14(1) are prescribed by an employer  for his  employees working in the establishment to which  the Act  applies, wages for work in excess of such prescribed hours  of work  will have  to be paid at the rate prescribed in  Sec. 31.  The framers of the statute provided the whole  scheme by first putting an embargo on the maximum number of  working hours  payable at ordinary rates and then permitting overtime  work up  to the ceiling, simultaneously making it  obligatory to  pay overtime  wages at  the rate F prescribed in the very statute.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 13  

    (18) The  next question  then is:  where  the  employer prescribes working  hours less  than the maximum permissible in the statute, does he incur the obligation to pay overtime wages at  the rates  prescribed in  the  statute  ?  If  the employer were  to contend that even though it has prescribed normal  working  hours  less  than  that  permitted  by  the statute, and therefore, it would not be liable (1) [1957] 1 All E.R. 497 (2) [1953] SCR 677 (3) [1978] 3 SR 370 504 to pay  any overtime  wages for  the work taken in excess of its own  prescribed rates  of  wages,  the  prescription  of working hours  less than  the maximum  permissible under the statute would be a facade because thereby the employer would enable  itself  to  increase  the  working  hours    without incurring any  liability to  pay overtime wages. Ordinarily, therefore, where an employer prescribes normal working hours less than  the maximum  permitted by  the statute  and if it seeks to take work in excess of its own prescribed number of hours of  work, the  employer renders  itself liable  to pay overtime wages  at any rate higher than the ordinary rate of wages. As explained earlier, prescribed working hours is the normal time of work and anything in excess of it is overtime work. It was not disputed on behalf of the employer that any work taken  for a  period in  excess of  the  working  hours prescribed by  both the  appellants-employers would  make it obligatory for  the  employer  to  pay  overtime  wages  and necessarily that  must be  higher than  the ordinary rate of wages prescribed  for normal  working hours.  This is not in dispute. Both  the appellants-employers have prescribed rate of overtime  wages at  11/2 time  the ordinary wages for the period in  excess of  the prescribed working hours and up to the maximum  permissible under  the Act.  Both concede  that beyond the maximum number of working hours permitted by Sec. 14(1), there  is no  option with  the employer  but  to  pay overtime wages  at the rate prescribed in Sec. 31. It is not a case  as was  sought to be canvassed in Indian Oxygen Ltd. v. Their  Workmen(l), where the employer contended that even though it  had prescribed total working hours per week at 39 hours and  as the  establishment was  governed by  the Bihar Shops and  Establishments Act,  which permits maximum number of hours  of work  at 48  hours per  week and  provides  for double the  rate of  ordinary wages for the work done beyond 48 hours  per week,  it was  not liable  to pay any overtime wages at  a rate  higher than  ordinary wages for the excess work taken beyond 39 hours per week and up to the ceiling of 48 hours  per week. This Court negatived this submission and held that  once the  employer fixed  hours of work less than the maximum  prescribed in  the statute, the provisions both as to  maximum hours  as well  as rate of overtime allowance beyond the  maximum hours  prescribed by  the statute has no relevance and cannot be relied upon. But as (1) (1969) 1 SCR 550 505 the employer  has prescribed total working hours at 39 hours per week,  any work  taken in excess of the prescribed hours of work  would be  overtime work and that if as contended by the employer, that it was entitled to take any such overtime work at  ordinary rate of wages, it would be paying no extra compensation at  all for the work done beyond the prescribed hours of  work  and  the  company  would  be  in  that  case indirectly increasing  the hours  of work  and  consequently alter its  conditions of  work. This  extreme  argument  was rejected and the Court upheld the award of the Tribunal that

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 13  

for the  ‘period in  excess of  the prescribed working hours and up  to the  ceiling of  48 hours.  the employer would be liable to  pay overtime  wages at the rate of 11/2 times the ordinary wages  and dearness  allowance payable to them. Let it be  noted that  court did not interfere with the award by saying that  once overtime  work is  taken  irrespective  of maximum fixed  in the  statute, the  statutory rate would be attracted. Undoubtedly,  therefore, this  decision  supports the submission  that where  the employer  prescribed working hours per day or total number of hours of work per week less than the  maximum permissible  under the  statute, any  work taken in  excess of  the prescribed  hours of  work would be overtime work  and the  employer would be liable to pay some compensation but  not necessarily the statutory compensation which would  be attracted  only when the employer takes work in excess  of the  maximum hours  of work  prescribed by the statute.      (19) Learned  counsel for the respondent contended that the trend of decisions is in favour of holding that the rate of payment for overtime work prescribed by the statute would be admissible  even  where  the  employer  prescribed  total number of  working hours  less than  the maximum permissible under the  statute. Reliance  was placed  on  A.K.  Basu  v. I.C.I. (India)  Pvt. Ltd.  and Ors.(l)  wherein  a  Division Bench of  the Calcutta  High Court  after referring  to  the provisions of the West Bengal Shops and Establishments, 1963 held that  once the  employer  prescribed  total  number  of working hours at 36 per week and the statute permitted total number of working hours at 48 hours a week, according to the dictionary meaning,  the employee  has worked overtime. Once he was called (1) (19 75) I LLJ 239 506 upon to  work beyond  36 hours, the rate of overtime payment would be  as prescribed  in the  statute. In  reaching  this conclusion, reliance  was placed  on  the  decision  of  the Indian Oxygen Ltd.(l) We have already explained the ratio of the decision of this Court in the case of Indian Oxygen Ltd. and it  does not  bear out  the observations  of   the  High Court. Reliance  was also  placed on M/s Carew & Co. Ltd. v. Sailaja Kanti  Chatterjee and  Anr.A learned Single Judge of the Calcutta  High Court  has  taken  the  same  view  after distinguishing the  decision in  the case  of Indian  Oxygen Ltd. The  reasons which  appealed to  the learned  Judge  to distinguish the  ratio of  the decision   in the case of the Indian Oxygen  Ltd. failed  to  impress  us.  In  fact,  the decision in  that case clearly rules that the statutory rate of overtime wages has relation only to the maximum number of hours of  work permissible under the statute and any work in excess thereof.      (20) Reverting  to the  facts of  both the cases, it is undoubtedly true  that  Section  14(1)  does  not  prescribe normal hours  of work  but merely  puts an  embargo  on  the employer’s right to prescribe daily and weekly hours of work beyond permissible  under the Statute. But where the statute itself prescribes  such permissible  hours of  work and also makes it  obligatory to  pay overtime  wages and  prescribes rates, it  can only mean work in excess of the maximum hours of work  permissible under  the statute  which  alone  would attract  the  rate  of  payment  for  overtime  work.  ’Such overtime work’  in Section  31   would and  could only  mean overtime as understood in the proviso to Section l4(1) which has reference  to maximum hours of work permitted by Section 14(1). This is how the statute has to be read as a whole.      (21) We  must not  be understood  to say that where the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 13  

statute prescribes  maximum number of daily and weekly hours of  work   and  the   employer  prescribes   less  than  the permissible hours  of work,  work taken  in excess  of  such prescribed number of hours will not be over- (6) (1972) II LLJ 359. 507 time work,  or that  the employer would not be liable to pay wages for  such work  at a  rate higher  than  the  ordinary wages. An  attempt to  so contend was made before this Court in Indian Oxygen Ltd. vs. Their Workmen. That contention was repelled and this Court held;      "If  the   company  ware  asked  to  pay  at  the  rate      equivalent to  the ordinary rate of wages for work done      beyond 39  hours, but not exceeding 48 hours a week, it      would be  paying no  extra compensation  at all for the      work done  beyond the agreed hours of work. The company      would in  that case  be indirectly increasing the hours      of work  and consequently  altering its  conditions  of      service."      The only  question in  such a  situation would be as to what D  ought to  be the  rate of wages payable. Such a rate must be  the subject matter of agreement between the parties or an award by industrial adjudication. Any work taken for a period in  excess  of  the  maximum  permissible  under  the Statute would  indisputedly attract  the statutory  rate  of overtime of wages,      (22) Both  the employers  have prescribed  the rate  of overtime wages at 11/2 times the ordinary wages for overtime work in excess of its prescribed hours of work and up to the maximum permissible  under Section  14(1).  Therefore,  they cannot be  accused of  indirectly  extending  their  working hours. Both employers conceded that for at work for a period in excess of the maximum permissible hours of work under the statute must  be paid  for and is being paid for at the rate prescribed in  the statute.  In our  opinion, therefore, the High Court  was in  error in  directing the employers to pay for overtime  work in excess of the prescribed hours of work and up to the maximum permissible under Sec. 14(1) at double the ordinary  wages by  invoking Sec. 31. For these reasons, both these  sets of  appeals will have to be allowed and the common Judgment  of the  High Court  governing all  the five writ petitions  as well  as the  common orders  of both  the Labour Courts  will have to be quashed and set aside and the applications made by the employees under Sec. 33-C(2) of the I.D, Act will have to the dismissed. 508      (23) Accordingly,  all the  appeals in both the batches succeed and  are allowed  and the judgment of the High Court from which  these appeals  arise is quashed and set aside as also the  applications made  by various employees under Sec. 33-C(2) of the I.D. Act are dismissed.      (24) While  granting leave this Court directed that the appellants irrespective  of the  decision in  these  appeals will have  to pay  costs to the respondents in one set only. In accordance  with this direction, the appellants shall pay costs to the respondents in one set only. S.R.                                         Appeal allowed. 509