http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 10  

PETITIONER: S. GANAPATHY AND ORS.

       Vs.

RESPONDENT: AIR INDIA AND ANR.

DATE OF JUDGMENT16/06/1993

BENCH: PUNCHHI, M.M. BENCH: PUNCHHI, M.M. AGRAWAL, S.C. (J)

CITATION:  1993 AIR 2430            1993 SCR  (3)1006  1993 SCC  (3) 429        JT 1993 (4)    10  1993 SCALE  (3)19

ACT: % Industrial Disputes Act, 1947 Section  33(2) (b) read with Section  2(rr)-Statutory  wage- Computation  of  amount of one month’s wages to be  paid  to discharged/dismissed  workmen-Whether employer justified  in reducing  the  amount by  statutory  tax  deductions-Whether approval  applications liable to be rejected on ground  that deduction  of  tax  resulted in payment  of  less  than  one month’s   wages-Order  of  discharge/termination   requiring approval  of competent authority-Nature and effect of  order till approval.

HEADNOTE: The appellants, employees of the respondent  Air India,  who were  awarded  penalties  of removal  or  dismissal  by  the respondent,  as  a result of the  disciplinary  proceedings, were paid one month’s salary or, wages, reducing it by a sum of Rs. 10 or 15, as deductible on account of monthly payment of  tax on employment, imposed on salary and  wage  earners, under  the  provisions  of  the West  Bengal  State  Tax  on professions,.  Trades, Callings and Employments Act,1979.The respondent-Air India sought approval of its action from  the National Industrial Tribunal, under Section 33(2) (b) of the Industrial Disputes Act, which was opposed by the appellants on  the ground that there was short payment and  accordingly it  was not in terms of the mandatory provisions of  Section 33(2) (b) of the Act.  The Tribunal upheld the objection and rejected the approval applications. In  writ  petitions preferred by the respondents,  a  Single Judge of the High Court held that the Tribunal was in  error in  refusing  approval on the ground of  short  payment  and remanded the matter to the Tribunal for decision on  merits’ Letters  Patent  Appeals preferred by the  appellants-  were dismissed  by a Division Bench of the High  Court  affirming the view of the Single Judge. In the appeals preferred by the employees, on behalf of  the appellants   it   was  contended  that  one   month’s   wage statutorily required to he paid in terms 1007 of  Section 33(2) (1)) was a payment which did not pay  take

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 10  

the  character of salary or wage as the appellants were  not salary or wage earners while getting that one month’s "-age, and  therefore,  not being salary or wage  earners  in  that month, order (if dismissal or termination of service  having been  passed against them, they were not in  employment  and hence  not  liable to pay tax, that the very  basis  of  tax stood  displaced  and  hence the deduction  of  tax  at  the snapped  source  rendered  the payment  or  deposit  of  one month’s   wage   deficient,   contravening   the   mandatory provisions of Section 33(2) (b) of the Act. It  was  contended on. behalf of the respondent   Air  India that  the statutory deduction of tax payable under  the  Tax Act  inhered in the payment of one month’s wage. and in  any case,  the difference had been tendered before the  Tribunal for payment to the workman, on objection raised, during  the pendency of the approval proceedings. Dismissing the appeals, this Court HELD  :  1.  When an order of discharge or  dismissal  of  a workman  is incomplete and inchoate until it,-; approval  is obtained   from   the  Tribunal,  there  is   no   effective termination  of  the relationship of the  employer  and  the employee.   Not only in a limited way that the  relationship is  snapped factually and one month’s wage is given  to  the employee  to soften the rigour of his  factual  unemployment but  the content and character of the wage would  extendedly tend  to remain the same so far as subjection  to  statutory tax  deduction  is  concerned, being  remuneration  paid  as understood in Section 2 (rr) of the Industrial Disputes Act. on  the supposition that the terms of employment,  expressed or  implied,  were fulfilled and the same was due  as  wages payable  to the workman in respect of his  employment,or  of work done in such employment, even though he was not put  to work. 2.1.Bare-facedly  the inclusions and exclusions provided  in Section  2(rr)  do  not  refer  to  tax  dues.   Rather  the provision is silent about statutory tax deductions.  But  it goes  without saving; if there is a statutory compulsion  to deduct,  that  compulsion would have an  intrusive  role  to play,  getting a proper fitment, as the law may warrant  its effect,  Section  33(2)  (b) apart.  The matter  has  to  be viewed in this light. 2.2.In the instant case, the appellants were salary or  wage earners, getting salaries or wages per month and from  their wages, prior to their order 1008 of  removal  or  dismissal, tax deductions  under  the  West Bengal  State  Tax  on Professions,  Trades,  Ceilings.  and Employments  Act,  1979.  were  being  made.   It  was   the employer’  liability to deduct and pay the tax on behalf  if the employee under Section 4 of the Act.  Failure to  comply with the provisions of the Section exposed the respondent to penalties and prosecution under other provisions of the Act. 3.1.The  proviso  to Section 33(2) (b) mandates  two  steps, that  unless  workman  is paid wages for one  month  and  an application  as contemplated is made by the employer to  the Tribunal for approval of his action, no such workman van  he discharged  or dismissed.  The intention of the  legislature in  providing  for  such a contingency was  to  soften.  the rigour  of unemployment that will face the workman,  against whom an order of discharge or dismissal. has been passed. 3.2.By passing the order of discharge or dismissal  de-facto relationship of employer and employee is ended, but not  de- jure,  for that could happen when the Tribunal  accords  its approval.  The employee. thus gets factually unemployed from the date of the approval application in the sense that he is

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 10  

not  called  to  work  and  is  paid  only  a  month’s  wage representing the succeeding month of his unemployment.   The relationship  of  employer  and  employee  is  legally   not terminated till approval of discharge or dismissal is  given by the Tribunal.  And this state of affairs was required  to he  ended within a period of three months; from the date  of receipt  of such application in terms of sub-section (5)  of Section  33, though the lapse of such period Would  not  end the proceeding and such time was extendable by the  Tribunal for reasons to be recorded in writing. 3.3.In  this fluid state of affairs, the legal character  of one  month’s wage would undergo a change depending  (on  the result of the approval application.  If the Tribunal were to refuse  the approval, the inchoate and incomplete  order  of discharge or dismissal would end and the legal character  of one month’s wages would transform to be the same as In-fore, from  which  statutory tax deduction could  legitimately  be made  by  the  employer.  In the event of  approval  of  the application  by  the Tribunal, the legal  character  of  one month’s  wage  would, on the other hand, be a  wage  without employment.  In the given situation, if the Tribunal were to refuse  approval  solely on the ground  that  statutory  tax deduction  stands  in its way to the grant of  approval,  it could legitimately make its order conditional on making good such payment.  This is a field in which the interest of both parties has to be kept in view, 1009 for the situation would be precarious for the employer if he were  not to deduct tax under section 4 of the Tax  Act  and exposing  him to the dangers of penalties  and  prosecution. If approval was to be rejected on merit and otherwise to  be rejected for not making complete payment of one month  wage, it would thus be just and proper to let the. employer deduct the statutory tax deduction from that one month wage,  since the relationship of employer and an employee has effectively not  been  terminated,  to meet the  eventuality,  lest  the approval  application be dismissed on merit.  On  the  other hand, it would be just and proper either for the employer on his  own  or on the asking of the Tribunal to  let  the  sum representing  statutory  tax deduction be deposited  in  the Tribunal  for  payment to the workman in the  event  of  the approval application being allowed.  If these two situations can  he saved in this manner there would, in no event, he  a dismissal  of the approval application for payment  of  wage subjected to statutory tax deduction. 3.4  Distinction  would have to be drawn  between  statutory deductions  like tax deductions and other  deductions  which the  employer  considers he can make.  In either  event,  he takes  the  risk when making a deduction.  In  the  case  of statutory tax deductions, his justificatory burden is  less, for  he  has the shelter of the tax law.  The  case  of  the other deductions would obviously be on different footing for he  may  not have any thrust of law.  Those  may  purely  be contractual.  Those deductions may not be  compulsive  under any law.  The employer makes the deduction in such cases  at his peril. 3.5  In  the instant case, there definitely arose a  genuine claim  to make the tax deduction and doing so  the  employer projected its case before the Tribunal in that angle.  Not a paisa  otherwise  was  kept back.  Thus, in  the  facts  and circumstances  of  the  case  the  respondent  was  able  to establish that its deliberate deduction representing the tax from one month’s wage was not to shorten the wage and  cause infraction  of  Section  33  (2)  (b),  but  a   compulsive’ deduction to fulfil a statutory obligation by the thrust  of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 10  

the Tax Act. Syndicate  Bank  Lid. v. Rain Nath Bhat,  (1967-68)  (XXXII) F.J.R.  490;  Tata Iron and Steel Co.  Ltd. v.  S.N.  Modak, [1963]  3 S.C.R. 411 and Bharat Electronics Ltd.,  Bangalore v. Industrial Tribunal, Karnatak, Bangalore and Anr., [1990] 1 S.C.R. 971, relied on. Muzaffarpur  Electric Supply Co. v.  S.K. Dutta, (1970)  LLJ Vol.2 p.547; Dinesh Khare v. Industrial Tribunal, Rajasthan, (1982)  LAD  I.C.  517 and Balmer- Lawrie and  Co.  Ltd.  v. Waman B.  More, [1981] 42 F.L.R. 272, distinguished. 1010

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 3134-36  of 1993. From the Judgment and Order dated 12.7.91 of the Bombay High Court ill Appeal Nos. 1309, 1309 and 1311 of’ 1997. M.   K. Ramamurthy.  Ms. Chandan Ramamurthi and M.A. Krishna Moorthy for the Appellants. F.S.  Nariman, Arun Jaitly, Lalit Bhasin, J.K.  Das,  Viplay Sharma and vineet Kumar for the Respondents. The Judgment of the Court was delivered by PUNCHHI, J. leave to appeal granted. The question which falls for determination in these  Appeals is whether in Computing the amount of one month’s wages,  to be  paid Under section 33(2) (h) of the Industrial  Disputes Act, 1947, (hereafter referred to as the ’Act’) the employer is  justified  in  reducing, the  amount  by  statutory  tax deductions’? The  three appellants herein, in the period 1979-80 were  in the employment of the respondent-Air India, and stationed at Calcutta.     They   individually   suffered    disciplinary proceedings on the charges of some mis-conducts and ha%-in,, been  found  guilty  were awarded penalties  of  removal  or dismissal  by the Air India, as, due to each.  It is  common ground  that  the respondent-Air India,  statutorily  bound, Applied  to  the National Industrial  Tribunal.   Bombay  by means of separate approval applications under section  33(2) (b) of the Act to have its action approved.  In terms of the said provision it paid to the appellants one month’s  salary or  wages reducing it by sum of Rs. 10 or 15, as  deductible on  account of monthly payment of tax on employment  imposed on  salary  And wage earners, under the provisions  of’  the West  Bengal State Tax on Professions Trades,  Callings  and Employments  Act,  1979 (hereafter referred to as  ’the  Tax Act).  The approval sought by the respondent-management  was opposed  by the appellants before the Tribunal.  and  though initially  not  part  of the defence taken  in  the  written statement defence was later set up by them that they had not been  paid  wages in terms of the  mandatory  provisions  of section  33(2) (b) of the Act, as there was  short  payment. This  put  the respondent management to Alert  and  it  laid before  the Tribunal account which, had gone on to work  out the  month’s  wages.  It is common ground that  the  payment otherwise  was  proper but since it was short by  10  or  15 rupees, as respectively due  on account of taxable under the Tax Act, the payment was termed as invalid. 1011 The Tribunal sustaining the objection rejected the  approval applications  on  that score alone and not  on  merits.   In separate writ petitions by the respondents, the Bombay  High Court  interfered  in the matter taking the  view  that  the Tribunal was in error in refusing-approval on the around  of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 10  

the  suggested short payment and hence breach of section  33 (2)  (b) of the Act.  The matter could not be  finalised  by the  learned  Single Judge and. remand to the  Tribunal  was made  for  decision  on  merits.   Letters  Patent   Appeals preferred  by the respective appellants were dismissed by  a division  bench of the Bombay High Court affirming the  view of  the  learned  Single Judge.  That  is  why  the  instant appeals. The  issue,  on the face of it, is  extremely  narrow.   But before  we get into grips with it, let us take stock of  the statutory  provisions which come into action leading to  the answer.  The first in priority are the two provisions of the Act being section 2 (rr) defining ’wages’ and section  33(2) (b) imposing the discipline, which are reproduced hereafter:               "2.  IN  THIS ACT, UNLESS  THERE  IS  ANYTHING               REPUGNANT IN THE SUBJECT OR CONTEXT, -               (rr) ’wages’ means all remuneration capable of               being  expressed  in  terms  of  money,  which               would,  if the terms of employment,  expressed               or  implied, were fulfilled, be payable  to  a               workman in respect of his employment, of  work               done in such employment, and includes -               (i)Such    allowances    including    dearness               allowances  as  the workman is  for  the  time               being entitled to;               (ii)the, value of any house accommodation.  or               of supply of light, water, medical  attendance               or  other amenity or of any service or of  any               concessional  supply  of  food-rains  or-other               articles,               (iii) any travelling concession;               (iv)  any commission payable on the  Promotion               of sales or business               or both;               but does not include-                (a)  any bonus;               1012               (b)   any contribution paid or payable by  the               employer to any pension fund or provident fund               or  for the benefit of the workman  under  any               law for the time being in force;               (c)   "any gratuity payable on the termination               of his service"               "SECTION 33 - CONDITIONS OF SERVICE, ETC.   TO               REMAIN UNC HANGED UNDER CERTAIN  CIRCUMSTANCES               DURING PENDENCY OF PROCEEDINGS               (1)xxxxxxxxxxx               (2)   During   the   pendency  of   any   such               proceeding   in  respect  of   an   industrial               dispute, the employer may, in accordance  with               the  standing orders applicable to  a  workman               concerned in such dispute or. where there  are               no  such standing orders, in  accordance  with               the terms of the contract, whether express  or               implied, between him and the workman,               (a)xxxxxxxxx               (b)   for  any misconduct not  connected  with               the  dispute, discharge or punish, whether  by               dismissal or otherwise, that workman               PROVIDED   that  no  such  workman  shall   be               discharged  or dismissed, unless he  has  been               paid  waves for one. month and an  application               has been made by the employer to the authority               before  which the proceeding is  pending  for-               approval of the action taken by the employer."

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 10  

Bare-facedly  the  inclusions  and  exclusions  provided  in section  2(rr)  do  not  refer  to  tax  dues.   Rather  the provision is silent-about statutory tax deductions.  But  it goes  without saying, if there is a statutory compulsion  to deduct, that compulsion would have an intrusive role to play getting a proper fitment, as the law may warrant its effect, section  33 (2) (b) apart.  The matter has to be  viewed  in this light. That  the  appellants were salary or wage  earners,  getting salaries  or wages per month is not in dispute.  It is  also not  in dispute that from their wages, prior to their  order of  removal or dismissal, tax deductions under the  Tax  Act were  being made.  There was no objection by the  appellants to  such deductions at that point of time.  That it was  the employers  liability to deduct and pay the tax on behalf  of the.  employee  under section 4 of the Act  is  also  beyond dispute.  Section 4 of the Tax 1013 Act  pointedly enjoins upon the employer to deduct  the  tax payable  under the Act from the salary or wages  payable  to any  person earning a salary or wage, before such salary  or wage  is paid to him and the employer has also been  foisted with  the liability to pay tax on behalf of salary  or  wage earner  irrespective of the fact whether such deduction  has been  made or not when the salary or wage was paid  to  such person.  In other words, the tax payable by the wage  earner is deductible from his wage irrespective of the fact whether such  deduction has been made or not, but the  liability  to pay  tax is on the employer.  Thus it cannot be denied  that while  the  appellants were salary or  wage  earners,  their wages or salary had to suffer & deduction of payment of  tax at the hands of the respondent-employer.  Failure to  comply the  provisions  of  section 4 of the Tax  Act  exposed  the respondent   to  penalties  and  prosecution   under   other provisions, of the Act, details of which need not be brought herein. It  was  canvassed  on behalf of  the  appellants  that  one month’s  wage  statutorily required to be paid in  terms  of section  33(2) (b) is a payment which does not  partake  the character  of  salary  or wage as the  appellants  were  not salary  or age earners while getting that one  month’s  wage Sequelly  it  was canvassed that not being  salary  or  wage earners in that month, orders of dismissal or termination of service  having been passed against them, they were  not  in employment and hence not liable to pay tax.  It was asserted that  the  very basis of tax stood displaced and  hence  the deduction of tax at the snapped source rendered the  payment or  deposit of one month’s wage deficient. contravening  the mandatory  provisions of section 33(2) (b) of the  Act.   On the  other hand, it was contended inter  alia on  behalf  of the  respondent that the statutory deduction of tax  payable under  the  Tax Act inhered in the payment  of  one  month’s wave,  and  in  any case the difference  had  been  tendered before the Tribunal for payment to the workmen, on objection raised.  during  the pendency of the  approval  proceedings. These are the contours of the dispute. The  proviso to section 33(2) (b) mandates two  steps,  that unless  the  workman  is paid wages for  one  month  and  an application  as contemplated is made by the employer to  the Tribunal for approval of his action, no such workman can  be discharged  or dismissed.  The intention of the  legislature in  providing for such a contingency is not far to seek  and as  was pointed out by this Court in the case  of  Syndicate Bank Limited v. Rain Nath Bhat 11 967-681 (XXXII) FJR 490 at 497 was "to soften the rigour of unemployment that will face

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 10  

the workman, against whom an order of discharge or dismissal has been passed." A  three-judge bench decision, authored  by  Gajendragadkar, C.J. of  this  Court in Tata Iron and Steel Co. Ltd. v. S.N. Modak [1963] 3 SCR 411 a page 418, 1014 had  the  occasion to spell out the nature of the  order  of discharge or dismissal.  It was ruled that-such order  being incomplete  and  inchoate until the  approval  is  obtained. could  not  effectively terminate the  relationship  of  the employer  and the employee, as the question of the  validity of the order would have to be gone into, and if approval  is not accorded by the Tribunal the employer would be bound  to treat the workmen concerned as its employee and pay him  all the   wages  for  the  period  even  though   the   employer subsequently  could  proceed  to  terminate  the  employee’s services.   Thus  this  Court’s view always  has  been  that relationship  of  employer and employee is  not  effectively terminated  by  the  passing of the order  of  discharge  or dismissal  until approval thereto in terms of section  33(2) (b) is accorded by tile Tribunal.  A  three-judge  bench of this Court  in  Bharat  Electronic Limited,   Bangalore  v.  Industrial   Tribunal,   Karnatak, Bangalore  and  another, [1990] 1 SCR 971 at  pages  976-977 observed as follows               "One month’s wages as thought and provided  to               be  given  are conceptually for the  month  to               follow,  the month of unemployment and in  the               context wages for the month following the date               of dismissal and not a repetitive wage of  the               month  previous to the date of dismissal.   If               the  converse  is read in the context  of  the               proviso to section 32(b), it inevitably  would               have to be read ,is double the wages earned in               the  month previous to the date  of  dismissal               and that would, in our view be, reading in the               provision something which is not there, either               expressly or impliedly." Bharat  Electronics was a case in which wages had been  paid or  offered  to the workman in terms of section  33(2)  (b). short of the night shift allowance, and this Court took  the view  that  from the date of dismissal or  removal  (factual though),  the occasion to earn night shift  allowance  could not  and  did  not  arise.  In order  to  earn  night  shift allowance  the  workman had to actually work  in  the  night shift  and for the purpose had to report for duty  on  being put to that shift.  It was in this situation held that night shift allowance automatically did not form part of his  wage as  it  was  not such an allowance which flowed  to  him  as entitlement not restricted to his service. In this extreme situation, the employee, in one sense,  gets unemployed  as he stands deprived of work with  effect  from the  date of the application for approval,    on which  date his  discharge  of  dismissal is  factually  effective.   He stands  paid his months, wage from such date and this  is  a wage conceptually for the month 1015 following not double the wage for the month previous to  the date  of  the  application.  This is  the  dicta  of  Bharat Electronics  case (supra).  In the other sense the order  of discharge  or dismissal is incomplete and  inchoate,  unless approved by the Tribunal and till approval is granted  there is  no  effective  break  of  the  employer’s  and  employee relationship.   This  is  the dictum of Tata  Iron  &  Steel Company’s  case.   So  if these two  features  are  grasped.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 10  

appreciated   and   blended,  it  would  lead  us   to   the understanding  that  by passing the order  of  discharge  or dismissal de-facto’ relationship of employer and employee is ended,  but  dot  de-jure, for that could  happen  when  the Tribunal  accords  its  approval.  The  employee  thus  gets factually   unemployed  from  the  date  of   the   approval application  in the sense that he is not called to work  and is  paid  only a month’s wage  representing  the  succeeding month of his unemployment.  The relationship of employer and employee   is  legally  not  terminated  till  approval   of discharge  or dismissal is given by the tribunal.  And  this state of affairs was required to be ended within a period of three months from the date of receipt of such application in terms  of subsection (5) of section 33, though the lapse  of such  period would not and the proceeding and such time  was extendable  by  the Tribunal for reasons to be  recorded  in writing.   Now  in this fluid state of  affairs,  the  legal character  of  one,  month’s wage  would  undergo  a  change depending,  on the result of the approval  application.   If the  Tribunal were to refuse the approval, the inchoate  and incomplete order of discharge or dismissal would end and the legal  character of one month’s wales would transform to  be the same as before, from which statutory tax deduction could legitimately  be  made  by the employer.  In  the  event  of approval  of  the  application by the  Tribunal,  the  legal character of one month’s wage would on tile other, hand be a wage  without  employment.  In the given situation,  if  the Tribunal  were to refuse approval solely on the ground  that statutory  tax deduction stands in its way to the  grant  of approval,  it could legitimately make its order  conditional on  making food such payment.  This is a field in which  the interest  of- both parties has to be kept in view,  for  the situation  would be precarious for the employer if  he  were not  to  deduct  tax  under section 4 of  the  Tax  Act  and exposing  him to the dangers, of penalties and  prosecution. If approval was to be rejected on merit and otherwise to  be rejected for not making complete payment of one month  wage, it would thus be just and proper to let the employer  deduct the statutory tax deduction from that one month wage,  since the relationship of employer and an employee has effectively not  been  terminated,  to meet the  eventuality,  lest  the approval application be dismissed on merit On the other hand it  would be just and proper either for the employer on  his own  or  on  the  asking of the  Tribunal  to  let  the  sum representing  statutory  tax deduction be deposited  in  the Tribunal  for  payment to tile workman in the,event  of  the approval application being allowed.  If these two situations can  be saved in this manner there would, in no event  be  a dismissal  of the approval application for payment  of  wage subjected  to statutory tax deduction.  Taken in this  tight one is to 1016 view   the  deduction  and  the  subsequent  offer  of   the respondent  to  pay the tax deducted,  and  later  deposited before  the  Tribunal,  for payment to  the  workman.   This payment was offered and deposited before the decision of the approval  application  at a time when  the  relationship  of employer  and employee had effectively not been  terminated. Here  distinction would have to he drawn  between  statutory deductions  like tax deductions and other  deductions  which the  employer  considers he can make.  In either  event,  he takes  the  risk when making a deduction.  In  the  case  of statutory  tax deductions his justificatory burden is  less. for  he  has the shelter of the tax law.  The  case  of  the other deductions would obviously be on different footing for

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 10  

lie  may  not have any thrust of law.  Those may  purely  be contractual.   Those deductions may not be compulsive  under any law.  The employer makes the deduction in such cases  at his  peril.   But  here, in  the  present  situation,  there definitely  arose a genuine claim to make the tax  deduction and  doing  so the employer projected.its  case  before  the tribunal  in  that angle.  Not a paisa  otherwise  was  kept back.  Thus in the facts and circumstances it appears to  us that   the  respondent  was  able  to  establish  that   its deliberate  deduction representing the tax from one  month’s wage  was not to shorten the wage and cause  infraction.  of section  33(2) (b) but a compulsive deduction to  fulfill  a statutory obligation by the thrust of the Tax Act. On  this  analysis and understanding the case of  the  Patna High  Court  in  Muzaffarpur Electric  Supply  Co.  v.  S.K. Dutta(1990)  LLJ  Vol.2  page 547 where when  the  loan  and money-order commission was deducted from one month’s  wages, it was held to be violative of section 33(2) (b) of the  Act and  the  case  Rajasthan  High Court  in  Dinesh  Khare  v. Industrial  Tribunal, Rajasthan(1982) LAB I.C. 517,  decided by S.C. Agrawal, then on that bench, and who is happily  now a  member  of  this bench, disapproving,  the  deduction  of provident fund on the finding, that those did not  represent "emoluments  carried by the workman concerned while on  duty within  the  meaning  of section  2(rr)  of  the-  Employees Provident  Fund  Act. being, cases  clearly  distinguishable would not further the case of the appellants.  Conversely  a single  bench decision of the Bombay flesh Court  in  Balmer Lawrie  and  Co.  Ltd. v. Waman  B. More  [1981]  42  F.L.R. 272275  would  also not further the case of  the  respondent because  instantly  no difficulty or inability to  make  the necessary  calculations at a particular point of time  arose which difficulty or inability get removed subsequently.  The claim  to  tax deduction was there to begin,with  and  could subsist till the grant of the approval application and  such grant  could be conditional on the payment back of  the  tax deduction.   All  option of this method  should  settle  the question.   We  do not wish to enter  upon  other  questions cropping  up to determine the tax liability of the  employer or the employee in that period of one month. 1017 At  this juncture, it would add to our understanding  if  we reproduce a passage from Bharat Electronics    case  supra). It is:               "Before    concluding   the    judgment    the               observations in Syndicate Bank’s case,  afore-               quoted, are again to he borne in mind.  In the               facts  and  circumstances  of  this  case  the               management  paid  to  the  workman  a  sum  of               Rs.607.90  as a month’s salary "to soften  the               rigour  of  unemployment that  will  face  the               workman".   Flow could a short payment of  Rs.               12  he said to have lessened the softening  of               such  rigour is thought stirring.   Viewed  in               the  context,  there  could  genuinely  be   a               dispute, as in the present case, as to whether               a particular sum was due as wages.  It is,  of               course,  risky for the management to raise  it               as  to pay even a paise less than the  month’s               wages  due under section 33(2) (b),  would  he               fatal  to its permission sought.  But  at  the               same time it needs to be clarified that it  is               for   the   management  to   establish,   when               questioned,  that the sum paid to the  workman               under section 33(2) (b) represented full wages

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

             of  the month following the date of  discharge               or dismissal, as conceived of in the provision               and  as  interpreted by us  in  entwining  the               ratios  in Bennett Coleman’s case (supra)  and               Dilbagh  Rai Jarry’s case (supra)  and  adding               something ourselves thereto." Thus on principle and percept we go on to hold that when  an order  of discharge or dismissal of a workman is  incomplete and  in  choate  until it’s approval is  obtained  from  the Tribunal,   there  is  no  effective  termination   of   the relationship of the employer and the employee.  Not only  in a limited way that the relationship is snapped factually and one  month’s  wage is given to the employee  to  soften  the rigour  of  his factual unemployment, but  the  content  and character  of the wage would extendidly tend to remain  the. same  so  far as subjection to statutory  tax  deduction  is concerned, being remuneration paid as understood in  section 2(rr)  of  the  Act, on the supposition that  the  terms  of employment,  expressed  or implied, were fulfilled  and  the same  was due as wages payable to the workman in respect  of his  employment,  or of work done in such  employment,  even though he was not put to work. Thus  as  a  result, we find no cause to  interfere  in  the judgment  and  order  of the  High  Court.   Accordingly  we dismiss  these appeals but leave the parties to  bear  their own costs. N.P.V.                               Appeals dismissed.’ 1018