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PETITIONER: STATE BANK OF PATIALA

       Vs.

RESPONDENT: RAM PRAKASH

DATE OF JUDGMENT: 06/12/1965

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. GAJENDRAGADKAR, P.B. (CJ) HIDAYATULLAH, M. RAMASWAMI, V. SATYANARAYANARAJU, P.

CITATION:  1966 AIR 1665            1966 SCR  (2) 898

ACT: National  Industrial Tribunal (Bank Disputes)  Award  (Desai Award) 1962 para. 5.356 cls. (i) to (iv)-Interpretation  and computation of benefits.

HEADNOTE: The  respondent-employees made applications under s.  33C(2) of  the  Industrial  Disputes  Act  for  determination   and computation of the benefit to which they were entitled under the  National  Industrial  Tribunal  (Bank  Disputes)  Award (Desai  Award) as they were not satisfied with the  fixation of  their pay by the appellant-bank under para 5.356 of  the Desai  Award.   The Bank claimed that under clause  (ii)  of para 5.356 of the Desai Award, the adjusted basic pay in,the new  scale was not to exceed what point-to-point  adjustment would  give  an employee on January 1, 1962  and  that  this being the maximum permissible under cl. (ii), cl. (iv) could not give an employee more than the maximum arrived at  under cl..  (ii).   The employees on the other hand  claimed  that they were entitled to what was provided by sub-cls. (a), (b) and (c) of cl. (iv) and the two increments under sub-cl. (d) and that it did not matter whether what was thus arrived  at exceeded  the maximum provided under cl. (ii).   The  Labour Court partially accepted the employees’ contention and fixed their pay accordingly.  In appeal. HELD:The  decision  of this Court in Prakash  Chand  Mehra’s case  would govern the interpretation of para 5.356  of  the Desai Award also, which is in substance the same as para 292 of  the  Sastry Award as modified by  the  Labour  Appellate decision. The  adjusted  basic pay in cl. (ii) has to be taken  as  on January  1,  1959.   This follows from  the  fact  that  the workman  basic pay as on January 1, 1959 cannot  be  reduced and therefore when cl. (ii) speaks of adjusted basic pay  it must refer to the same date as in cl. (i).  Further cl  (iv) which-provides  for  actual calculations starts  with  words "subject  to  rules (i) to (iii)" and therefore  the  actual calculations made under cl. (iv) must be subject to cls. (i) and  (ii).   This means in effect that the  actual  fixation

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under sub-cls. (a), (b) and (c) of cl. (iv) will be  subject to  cl. (i) and cl. (ii).  Under sub-cl. (a) of cl.  (iv)  a workman  will be placed in the Sastry Award as  modified  by placing him at the stage in the Sastry Award scale equal  to or  next  above his basic pay as on January 1, 1959  in  the scale  then in force in the bank concerned.  But in view  of cl. (i) this cannot be less than the actual basic pay of the workman  as  on January 1, 1959.  Where under  cl.  (i)  the actual  basic  pay as on January 1, 1959 is more  than  what point-to-point  adjustment  will  give under  cl.  (ii),  it cannot be reduced for cl. (ii) is subject to cl. (i).  After this  has  been  done  the  workman  would  be  entitled  to increments as provided in sub-cl. (b) read with sub-cl.  (c) of  cl. (iv), but this will be subject to cl. (i)  and  (ii) and  the  adjusted  basic  pay  arrived  at  by  giving  the increments  under  sub-cls. (b) and (c)  cannot  exceed  the adjusted   basic  pay  as  arrived  at   by   point-to-point adjustment in the Sastry Award as modified or the maximum of that scale or the                             899 actual basic pay as on 1st January 1959, as the case may be. Thus sub-cl. (a) is subject to cl. (i) and the basic pay  to be fixed on January 1, 1959 hag to be fixed by reading  sub- cl.  (a) of cl. (iv) and cl. (i) together.  Then  increments under sub-cl. (b) read with sub-cl. (c) of cl. (iv) have  to be  added,  but this is again subject to the  provisions  of cls. (i) and (ii). [903 E; 903 G-904 E] Once  it  is held that basic pay under cl. (ii)  has  to  be worked out as on January 1, 1959 the two increments provided by  sub-cl. (d) of cl. (iv) which are beyond that date  must be given over and above what has been worked out under  sub- cls.  (a), (b) and (c) of cl. (iv) of the Desai Award.   The fact that by oversight sub-cl. (d) of cl. (iv) was not  made a  separate clause would make no difference for sub-cl.  (d) provides-  for a period after the date up to which  cl.  (i) works. [904 H-905 B] State  Bank of India Prakash Chand Mehra, [1961]  11  L.L.J. 383, relied on.

JUDGMENT: CIVIL  APPELLATE JURISDICTION: Civil Appeals Nos.  1008  and 1009 of 1965. Appeals by special leave from the orders dated April 1, 1965 of the Central Government Labour Court, Jullundur, in  cases Nos. 409 of 1963 respectively. C.   K. Daphtary, Attorney-General, S. V. Gupte,  Solicitor- General, Niren De, Addl.  Solicitor-General, K. B. Mehta, V. Sagar, H. L. Anand and B. C. Das Gupta, for the appellants. M. K. Ramamurthi, for the respondents. The Judgment of the Court was delivered by Wanchoo,  J.  These  two appeals by special  leave  raise  a common question as to the interpretation of paragraph  5.356 of the National Industrial Tribunal (Bank Disputes) Award of June  1962 (popularly known as the Desai award) and will  be dealt with together.  It is unnecessary to set out the facts of  the two appeals at this stage.  It is sufficient to  say that  the respondents made applications under s. 33-C(2)  of the  Industrial  Disputes Act, No. 14 of 1947,  praying  for determination  and computation of the benefit to which  they were  entitled  under  the  Desai award  as  they  were  not satisfied  with the fixation of their pay by the  appellant- bank under para 5.356. The  Desai award dealt with the method of adjustment in  the

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scales  of  pay  fixed by it from para  5.329  onwards.   It divided  the  employees  of  the banks  with  which  it  was concerned  in  two  groups.  The first  group  consisted  of workmen  who  were  drawing basic pay  on  January  1,  1962 according  to  scales  of  pay  provided  by  the  ALL-India Industrial  Tribunal (Bank Disputes) Award, 1953  (popularly known  as  the  Sastry  award) as  modified  by  the  Labour Appellate  Tribunal  Decision (Bank Disputes).   The  second group 900 consisted of workmen who on January 1, 1962 were employed in banks  which  were  not governed by the  provisions  of  the Sastry award as modified and were not thus drawing basic pay on the footing of scales of pay provided by that award.   In the  first  case the Desai award provided that  the  workmen would  be  fitted in the new scales of pay from  January  1, 1962  on stage to stage adjustment basis, i.e., workmen  who were  drawing  basic pay at a particular stage in  the  time scale  of the Sastry award as modified would draw basic  pay at the same stage in the new scale applicable to them  under the  Desai award.  Examples of how this would be  done  were given  in para. 5.348 of the Desai award.  As to the  second group,  the Desai award provided that these employees  would first  be fitted in the appropriate scales provided  in  the Sastry  award  as  modified  as  on  January  1,  1962   and thereafter  they  would be fitted in the new scales  of  pay provided  by  the Desai award as laid down in  para.  5.348. Paragraph  5.356 then went on to provide how  these  workmen would be fitted in the Sastry award.  Here again the workmen were  divided  into two groups, namely,  those  who  entered service before January 1, 1959 and those who entered service on or after January 1, 1959.  In the present appeals we  are concerned with workmen who entered service before January 1, 1959,  and  the fitment of these workmen was dealt  with  in para.  5.356  of the Desai award, and it is  this  paragraph which calls for interpretation in the present appeals. We may at this stage mention that a similar question of fit- ment  was  considered by the Sastry award in para.  292  and certain provisions were made thereunder.  This paragraph was considered  by the Labour Appellate Tribunal in appeal  from the  Sastry  award  and  certain  modifications  were   made thereunder  by  paras 164 and 166 of  the  Labour  Appellate Tribunal  decision in appeal.  Paragraph 292 as modified  by the   Labour  Appellate  Tribunal  decision  came   up   for interpretation  before this Court in State Bank of India  v. Prakash  Chand  Mehra. (1) As the words of para 292  of  the Sastry  award as modified by the Labour  Appellate  Decision are almost the same as the words of para. 5.356 of the Desai award, we may set out the two paragraphs in parallel columns for comparison: Sastry award as modified by the Labour Appellate decision For  workmen  who  enterd service of the  bank  before  31st January, 1950 1.   The  workman’s basic pay as on 31st January 1960  shall not be reduced in any case. (1)  [1961] 2 L.L.J. 383. Desai award For workmen who entered service of the bank before 1st January 1959 (i) The workman’s basic pay as on January 1, 1959 shall  not be reduced in any case. 2.  Subject  to rule (1) the adjusted basic pay in  the  new scale shall not exceed what point-to-point adjustment  would give him or the maximum in the new scale.

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3.In  the matter of adjustment all efficiency bars,  whether in  the  previously existing or in the scales  fixed  by  us should be ignored. 4.Subject  to rules (1) to (3) a workman’s basic pay in  the new scales shall be fixed in the following manner (a)  A  workman shall first be fitted into the scale of  pay fixed by our award (herein called the new scale) by  placing him  at the stage in the new scale equal to, or  next  above his  basic pay as on 31st January 1950 in the pre-Sen  scale then in force (herein called the existing scale). (b)  To the basic pay into which he is fitted under cl.  (a) the  annual increments in the new scale as from  that  stage onwards  should  be added at the rate of one  increment  for every completed three years of service in the same cadre  as on  31st January 1950, up to a limit of 12  years’  service; hereafter  one increment for every four years of service  up to another 8 years service, and after that one increment for every five years of service. (c) Such increments shall not however exceed four in number. [NOTE : Omitted by the Labour Appellate Tribunal in view  of change in cl. (b).] 4-A.  After adjustments are made in accordance with  clauses (a),  (b)  and (c) supra two further increments in  the  new scale  will be added thereto for service for the  two  years 1951 and 1952.  In addition the workman  will be entitled to draw  his  normal  increment  for  1953on  1st  April  1963. Thereafter  each  succeeding year’s annual  increment  shall take effect as and from 1st April of that year. 901 (ii)  Subject  to rule (i), the adjusted basic  pay  in  the scale  provided  in the Sastry award as modified  shall  not exceed what point-to-point adjustment would give him or  the maximum  in  the  scale  provided by  the  Sastry  award  as modified. (iii)  In  the matter of  adjustment,  all  efficiency-bars, whether  in the previously existing scales or in the  scales provided by the Sastry award as modified should be ignored. (iv)Subject  to rules (i) to (iii) a workman’s basic pay  in the scale provided by the Sastry award as modified shall  be fixed in the following manner (a)A workman shall first be fitted into the scale of pay  of Sastry award as modified by placing him at the stage in  the Sastry  award scale as modified equal to, or next above  his basic pay as on 1st January, 1959 in the scale then in force in the bank concerned (hereinafter called the Bank’s scale). (b)To the basic pay into which he is fitted under clause (a) annual  increment  or increment& in scale  provided  by  the Sastry  award as modified as from that stage onwards  should be  added at the rate of one increment for  every  completed three  years  of  his service in the same cadre  as  on  1st January 1959. (c) Such increments shall not however exceed four in number. (d)  After adjustments are made in, accordance with  clauses (a),(b)   and  (c) supra, two further annual increments.  in the  scale provided by the Sastry award as modified will  be added  thereto  for service for the two years  of  1960  and 1961. 902 We   are not concerned with clauses (5) and (6) of para  292 of the    Sastry award or with clauses (v) and (vi) of  para 5.356 of the   Desai  award  for  purposes  of  the  dispute between the parties and  have not therefore set them out. It will be seen from the above comparison of the provisions in  the  two awards that the substantial provisions  of  the Desai  award are exactly the same as the provisions  of  the

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Sastry award as modified except (i) for changes necessitated by the fact that the Desai award was being given in 1962 and (ii) the provision in the Sastry award corresponding to sub- cl.  (d)  of cl. (iv) of para 5.356 of the Desai  award  was separated by the Labour Appellate Tribunal Decision from cl. (4) and made clause (4-A).               "We  have  already referred to the  fact  that               para. 292 of the Sastry award as modified came               up for consideration before this Court in  the               case of Prakash Chand Mehra(-’) and this Court               interpreted clauses (1) to (4-A) of the Sastry               Award  as  modified thus :"We  have  therefore               first to fix the basic pay in accordance  with               rule 4(a), and then allow annual increments in               accordance  with  rule  4 (b).   But  this  is               subject to rules 1 and 2 above.  We are unable               to  accept the contention raised on behalf  of               the  respondent  that the words  "subject  to"               have  not  the  effect of  making  what  would               otherwise follow from the application of rules                             4(a) and 4(b) subject to "both the lim its" laid               down  in  rule 2. Giving as  we  must  natural               meaning to the words used in rules 2 and 4, we               are  of opinion that in no case can the  basic               pay be fixed at a higher figure than what  the               point-to-point  adjustment would give  to  the               workman or the maximum in the new scale." The dispute between the bank and the workmen in the  present ,case was this.  The bank claimed that under cl. (ii) of the Desai award, the adjusted basic pay in the new scale was not to  exceed  what  point-to-point adjustment  would  give  an employee on January 1, 1962.  The bank further claimed  that this  being the maximum permissible under cl. (ii)  and  cl. (iv)  being  subject  to  cl. (ii)  the  method  of  fitment provided in cl. (iv) could not give to an employee more than the maximum arrived at under cl. (ii).  Thus the bank’s case was  that  once  the maximum arrived  at  by  point-to-point adjustment  as  on January 1, 1962, was  reached  under  cl. (ii), no further increments even under sub-cl. (1)  [1961] 2 L.L.J. 383.                             903 (d)  of  cl.  (iv) could be allowed.  The,  workmen  on  the other  hand  claimed  that they were entitled  to  what  was provided  by sub-cls. (a), (b) and (c) of cl. (iv)  and  the two increments under sub-cl. (d) and that it did not  matter whether  what  was  thus arrived  at  exceeded  the  maximum provided  under  cl. (ii).  The labour court  has  partially accepted  the workmen’s contention and fixed the pay of  the two  workmen concerned accordingly.  The bank  contests  the correctness of this view. We  are of opinion that neither the stand taken by the  bank nor the stand taken by the workmen is correct, and that  the relevant  clauses in para. 5.356 of the Desai award must  be interpreted in the same manner as the relevant provisions in the  Sastry  award as modified were interpreted  in  Prakash Chand Mehra’s case(1).  In this connection it is brought  to our  notice  that in para. 5.356 of the Desai award  it  was stated that the award was giving directions similar to those provided  under  the  Sastry award as  modified  subject  to certain  changes  which  were  considered  necessary  having regard  to the lapse of time after coming into force of  the provisions of the Sastry award as modified.  It is urged  on behalf  of the appellant that the Desai award  made  certain changes  and therefore need not be interpreted in  the  same

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way as was done in Prakash Chand Mehra’s case(1).  We see no force  in this submission.  It is true that the Desai  award said that certain changes were being made; but these changes were  considered  necessary having regard to  the  lapse  of time.   However, the main intention of the Desai  award  was also  to  give directions similar to those provided  in  the Sastry  award as modified.  It is true that there  are  some verbal changes in the Desai award; but these verbal  changes are  only  due  to  lapse of time  and  do  not  affect  the substance  of  what  was provided by  the  Sastry  award  as modified. We do not agree with the case of the appellant-bank that  in cl.  (ii) the adjusted basic pay is to be as on  January  1, 1962.  We are of opinion that the adjusted basic pay in  cl. (ii)  has to be taken as on January 1, 1959.   This  follows from the fact that the workman’s basic pay as on January  1, 1959 cannot be reduced and therefore when cl. (ii) speaks of adjusted basic pay it must refer to the same date as in  cl. (i).    Further   cl.  (iv)  which   provides   for   actual calculations starts with the words "subject to    rules  (i) to  (iii)" and therefore the actual calculations made  under cl.  (iv)  must be subject to clauses (i)  and  (ii).   This means in (1) [1961] 2 L.L.J. 383. L8Sup.CI/66-11 904 effect that the actual fixation. under sub-cls. (a), (b) and (c)  of  cl. (iv) will be subject to cl. (i) and  cl.  (ii). Under  sub-cl. (a) of cl. (iv) a workman will be  placed  in the Sastry award as modified by placing him at the stage  in the Sastry award scale equal to or next above his basic  pay as  on  January 1, 1959, in the scale then in force  in  the bank concerned.  But in view of cl. (i) this cannot be  less than  the actual basic pay of the workman as on  January  1, 1959.   Where  under  cl. (i) the actual  basic  pay  as  on January 1, 1959, is more than what point-to-point adjustment will give under cl. (ii), it cannot be reduced for cl.  (ii) is subject to cl. (i).  After this has been done the workman would  be entitled to increments as provided in sub-cl.  (b) read with sub-cl. (c) of cl. (iv), but this will be  subject to  cls. (i) and (ii) and the adjusted basic pay arrived  at by  giving the increments under sub-cls. (b) and (c)  cannot exceed  the  adjusted basic pay as arrived at  by  point-to- point  adjustment  in the Sastry award as  modified  or  the maximum  of  that scale or the actual basic pay  as  on  1st January  1959,  as  the case may be.  Thus  sub-cl.  (a)  is subject to cl. (i) and the basic pay to be fixed on  January 1, 1959, has to be fixed by reading sub-cls. (a) of cl. (iv) and  cl.  (i) together.  Then increments under  sub-cl.  (b) read with sub-cl. (c) of cl. (iv) have to be added, but this is again subject to the provisions of cls. (i) and (ii). After  this has been worked out, then comes sub-cl.  (d)  of cl. (iv), and the main dispute in the present case is  about this subclause.  The appellant-bank’s contention is that two further  annual increments allowed under sub-cl. (d)  cannot be  permitted  in  view of cl. (ii) as  interpreted  by  the appellant.   But  as  we, have held that  in  cl.  (ii)  the adjusted  basic pay has to be fixed as on January  1,  1959, sub-cl. (d) of cl. (iv) will take effect and give two annual increments for 1960 and 1961 which are beyond the date which we have accepted as the right date for purposes of cl. (ii). It is however urged on behalf of the appellant that sub  cl. (d) is also subject to cls. (i) to (iii) and therefore these increments  if they go beyond what cl. (ii) provides  cannot be given.  This argument has arisen because the Desai  award

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did  not  separate  sub-cl. (d) as was done  by  the  Labour Appellate Tribunal in its modification of the Sastry  award. But as stated by the Labour Appellate Tribunal when  dealing with  the Sastry award, it was inherent in the Sastry  award that  increments for 1951 and 1952 should be provided  after the  basic pay was worked out as on January 31,  1950.   The same  applies to the Desai award.  Once it is held-and  that we  hold-that basic pay under cl. (ii) has to be worked  out as  on January 1, 1959, the two increments provided by  sub- cl. (d) of cl. (iv) which are beyond that date must 905 be given over and above what has been worked out under  sub- cls.  (a), (b) and (c) of el. (iv) of the Desai award.   The fact that by oversight sub-cl. (d) of el. (iv) was not  made a  separate clause would make no difference for sub-cl.  (d) provides  for a period after the date up to which  el.  (ii) works.  Therefore, two increments under sub-cl. (d) have  to be  given  after adjustments have been made  under  sub-cls. (a), (b) and (c) of el. (iv) in accordance with what we have interpreted  these sub-clauses as well as cls. (i) and  (ii) to  mean.  In effect the two increments provided in  sub-el. (d) must always be given.  But it may happen that increments provided  in sub-cl. (b) read with sub-cl. (c) may  in  some cases be not available where the actual pay as on January 1, 1959  which  will not be reduced under el. (i)  happened  to coincide with or was more than the adjusted basic pay  under el.  (ii).  This interpretation is in accord with  what  was decided by this Court in Prakash Chand Mehra’s case(1),  and that decision in our opinion would govern the interpretation of  para.  5.356 of the Desai award also, which as  we  have indicated,  is  in substance the same as para.  292  of  the Sastry award as modified by the Labour Appellate decision. We now turn to the actual fixation of pay in each case.   We shall  first take the case of Ram Parkash (i.e. C.A.  1008). I-le joined service on April 11, 1949.  His basic pay as  on January 1,1959 was  Rs.  106.   His  place  of  posting  was Phagwara  in  area  ITT.  Point-to-point  adjustment  as  on January 1, 1959, would give   him  Rs.  106  in  the  Sastry award scale as modified.  This is equal to his actual salary as  on January 1, 1959.  Therefore under sub-cl. (a) of  el. (iv) his salary has to be fixed as on January 1, 1959 at Rs. 106.  He would not be entitled to any increments under  sub- cls.  (b) and (c), because his actual salary coincided  with the adjusted basic pay in the Sastry award scale as modified as on January 1, 1959.  He would however be entitled to  two increments under sub-cl. (d) for the years 1960 and 1961 and his salary therefore as on January 1, 1962 under the  Sastry award  would  come to Rs. 119.  As Rs. 119 is  the  eleventh stage in the Sastry scale, Ram Parkash would be entitled  to the  eleventh stage in the Desai scale, which would  be  Rs. 170.   The  bank actually fixed him at Rs. 176  on  its  own interpretation  of  the award.  In  the  circumstances,  Ram Parkash  was  not  entitled to any relief  from  the  labour court. Tek  Chand Sharma respondent in C.A. 1009 was  appointed  on November 15, 1950.  His salary as on January 1, 1959 was Rs. 100 and his place of posting was Nakodar in area IV of the (1)  [1961] 2 L.L.J. 383 906 Sastry  award.   His  salary  according  to   point-to-point adjustment  would  come to Rs. 85.  But under  cl.  (i)  his salary cannot be fixed below Rs. 100, which he was  actually getting.   Under subcl. (a) of cl. (iv) his salary  will  be fixed  at  Rs.  100.   He  would  not  be  entitled  to  any increments under sub-cls. (b) and (c) of cl. (iv) because he

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was  getting more than what would be his adjusted basic  pay under  cl. (ii).  Therefore, for purposes of sub-cl. (a)  of cl. (iv) he would be fixed at Rs. 100 as on January 1, 1959, and would be entitled to increments under sub-cl. (d)  which will  bring  his salary to Rs. 112 as on  January  1,  1962. This  is the thirteenth stage in the Sastry scale.   Nakodar is now in area III in the Desai award.  The thirteenth stage in  the Desai award scale is Rs. 182 for that area.  So  his salary as on January 1, 1962 would be fixed at Rs. 182.   In addition  he  is entitled to two increments  on  account  of being a graduate and one increment on account of his  having passed  the Indian Institute of Bankers’  examination.   His actual salary in the Desai scale on January 1, 1962 will  be Rs. 182 plus Rs. 33, i.e., Rs. 215.  The bank fitted him  on Rs.  193.   The award of the labour court therefore  in  the case of Tek Chand Sharma is correct. We therefore allow C.A. 1008 and set aside the order of  the labour court and dismiss the application of Ram Parkash.  We make  no order as to costs in the circumstances.  C.A.  1009 is  hereby dismissed.  We make no order as to costs  in  the circumstances. C.A. 1008 allowed. C.A. 1009 dismissed. 907