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PETITIONER: THE RASHTRIYA MILL MAZDOOR SANGH,PAREL, BOMBAY AND ANOTHER

       Vs.

RESPONDENT: THE APOLLO MILLS LIMITED AND OTHERS

DATE OF JUDGMENT: 10/03/1960

BENCH: HIDAYATULLAH, M. BENCH: HIDAYATULLAH, M. DAS, S.K. SARKAR, A.K.

CITATION:  1960 AIR  819            1960 SCR  (3) 231  CITATOR INFO :  D          1986 SC1514  (17)

ACT: Industrial Dispute-Compensation for closure of Mills-Partial closure due to shortage of Power-Government Order curtailing supply of power-Standing Ordeys-Scope of-Bombay  Electricity (Special  Powers) Act, 1946 (Bom.  XX of 1946),  ss.  6A(1), 11(1)--Bombay  Industrial Relations Act, 1946 (Bom.   XI  Of 1947), ss. 40 (1), 73.

HEADNOTE: In 1951 on account of the failure of the monsoon, generation of  electricity from the Hydro-Electric System was  affected and  it  was found necessary to reduce  the  consumption  of electricity.  The Government of Bombay passed an order under s.  6A(1)  of the Bombay Electricity (Special  Powers)  Act, 1946,  regulating  the  use of  electrical  energy  and  the respondent Mills were compelled to reduce the working  time. For the period during which the short working continued  the workers  claimed  their  wages and  dearness  allowances  or compensation in lieu thereof.’ The Industrial Court to which the  matter was referred for arbitration under S. 73 Of  the Bombay  Industrial  Relations  Act,  1946,  made  an   award directing  all the respondent Mills to pay  compensation  to the  employees.  The Mills pleaded that no compensation  was payable  because  (1)  the  closure  of  the  Mills  was  in pursuance of the directions made by the Government under the Bombay   Electricity  (Special  Powers)  Act,   1946,   and, therefore,  s. 11(1) of that Act barred the  reference,  (2) the  Industrial Court had no jurisdiction to  entertain  the claim for compensation as the matter was covered by Standing Orders  16 and 17 which were determinative of the  relations between  the workmen and their employers under S.  40(1)  of the  Bombay Industrial Relations Act, 1946, and (3)  in  any case, no compensation was payable in view of the decision in Muir  Mills  Co. Ltd. v. Suti Mills Mazdoor  Union,  Kanpur, [1955] 1 S.C.R. 991: Held, (1) that s. 11 (1) of the Bombay Electricity  (Special Powers) Act, 1946, barred only proceedings arising from  the interference   with  the  supply  of  electric  energy   and protected  those  who acted in pursuance  of  orders  passed

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under  that Act; the section did not prevent the raising  of an industrial dispute. (2)that Standing Orders 16 and 17 contemplated only  cases of  compensation in lieu of notice and wages for the  period of  closure,  and did not cover cases  of  compensation  for closure  ;  that  the  provisions of S.  73  of  the  Bombay Industrial  Relations Act, 1946, were wide enough  to  cover the  reference  in the present case and that the  claim  for compensation  was not barred by Standing Orders 16  and  17, read with s. 40(1) of the Act. Digambar Ramachandra v.  Khandesh Mills, (1949) 52 Bom. L.R. 46, disapproved. 232 (3)that the decision in Muir Mills Co. Ltd. v. Suti  Mills Mazdoor Union, Kanpur, was concerned only with the award  of bonus and was not applicable to the present case.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 419 of 1956. Appeal by special leave from the decision dated January  17, 1955, of the Labour Appellate Tribunal, of India, Bombay, in Appeal (Bom.) No. 61 of 1954. N.C.  Chatterjee,  D. H. Buch and I. N  Shroff,  for  the appellants. R.   J. Kolah, B. Narayanaswami, S. N. Andley, J. B. Dadachanji,  Rameshwar  Nath  and  P.  L.  Vohra,  for   the respondents. 1960.  March 10.  The Judgment of the Court was delivered by HIDAYATULLAH, J.-This is an appeal with the special leave of this Court against- a decision dated January 17,1955, of the Labour Appellate Tribunal (hereinafter called the  Appellate Tribunal) by which it reversed a decision of the  Industrial Court, Bombay, dated January 20, 1954, in a matter  referred to the Industrial Court under s. 73 of the Bombay Industrial Relations  Act,  1946,  by the Government  of  Bombay.   The appellant is the Rashtriya Mill Mazdoor Sangh,  representing the  employees  of the cotton textile mills in the  city  of Greater Bombay.  The respondents are the Apollo Mills, Ltd., and other companies owning cotton textile mills specified in the  annexure  to the Special Leave Petition  and  the  Mill Owners’ Association, Bombay, representing the cotton textile mill  industry.   The dispute relates  to  the  compensation which  the  workers claimed for loss of wages  and  dearness allowances  due  to  the short working  or  closure  of  the Textile  Mills  on certain days during  the  period  between November 1, 195 1, and July 13, 1952. The  facts  of  the case are as follows: In  the  year  1951 monsoon  failed,  and  caused  scarcity  of  water  in   the catchment area of the Tata Hydro-Electric system, from which the   Mills  obtained  their  supply  of  power.   It   was, therefore,  found  necessary to reduce  the  consumption  of electricity,  and- Government, after consulting the  various Mills  and also the appellant Sangh, decided that the  Mills should work, instead of 233 48 hours, for 40 hours per week during a period of 30  weeks from November 1, 1951.  It was also agreed that if the Mills could  reduce their consumption of electricity to  5/6th  of their normal consumption, then they could work for 48  hours per  week as before.  Some of the Mills installed their  own generators,  but  many others were compelled to  reduce  the working  time to 40 hours in a week, working at 8 hours  per day.   As  a result, the working of some of  the  Mills  was

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reduced by one day in the week, and the Mills lost a maximum number  of  38 days, some more and some less.   One  of  the Mills  (the Ragbuvanshi Mills) remained closed only  on  one day.   The order of the Bombay Government was made under  s. 6A(1) of the Bombay Electricity (Special Powers) Act,  1946. While  this  short working continued,  the  workers  claimed their wages and dearness allowances or compensation in  lieu thereof. Negotiations followed, but when they did not result in anything to the advantage of the workers, the matter  was referred  for  arbitration to the Industrial  Court  by  the Bombay  Government on October 30, 1952, under s. 73  of  the Bombay Industrial Relations Act, 1946. The  Mills raised the objection that the matter was  covered by  Standing Orders 16 and 17, and inasmuch as  the  partial closure of the Mills was due to force majeure, they were not liable.   They contended that the Industrial Court had  thus no jurisdiction, as these Standing Orders were determinative of  the  relations between the workmen and  their  employers under s. 40(1) of the Bombay Industrial Relations Act, 1946. They also submitted that the orders of the Government issued under the Bombay Electricity (Special Powers) Act, 1946, had to  be  obeyed and therefore no  compensation  was  payable. They  pointed  out that the employees  were  receiving  fair wages, and that the Mills were not in a position to bear  an additional  burden, in view of the fact that they  had  lost their  profits due to short working.  They relied  upon  the decision of the Bombay High Court in Digambar Ramachandra v. Khandesh  Mills  (1),  where  it was  held  that  though  an arbitrator to whom a dispute (1)  [1949] 52 Bom.  L.R. 46. 30 234 falling under B. 49A of the Bombay Industrial Disputes  Act, 1938,  was referred had jurisdiction to decide the  disputes within  the terms of the Standing Orders framed under s.  26 of  that  Act,  he  had no  jurisdiction  to  determine  the liability  of the employers on grounds outside the  Standing Orders. The  Industrial  Court, after hearing the parties,  made  an award  on January 20, 1954, and directed all the  respondent Mills  to  pay to the employees compensation,  holding  that Standing  Orders  16 and 17 were not applicable,  and  were, therefore,  no bar.  The Industrial Court held that in  view of  the provisions of ss. 3, 40(2), 42(4), 73 and 78 of  the Bombay Industrial Relations Act read with Sch. 111, item  7, and  having regard to the decision of the Federal  Court  in Western India Automobile Association v Industrial  Tribunal, Bombay (1), it had jurisdiction to grant compensation.   The Industrial  Court,  therefore, held that  on  principles  of social  justice the workers were entitled  to  compensation, which  it assessed at the rate of 50 per cent. of the  wages and dearness allowances which the workers would have  drawn, if the Mills had worked on the days they remained closed. Against that award, the Mill Owners’ Association and two  of the  Mills appealed to the Appellate Tribunal, Bombay.   All the  contentions  which were raised  before  the  industrial Court were once again raised before the Appellate  Tribunal. Two  new contentions were raised, viz., that the  claim  for compensation  was  barred  under  s.  1  1  of  the   Bombay Electricity (Special Powers) Act, 1946, and was also  barred by the decision of the Supreme Court in the Muir Mills  Co., Ltd. v. Suti Mills Mazdoor Union, Kanpur (2). The  Appellate Tribunal by its decision now impugned  before us,  allowed  the  appeal, and set aside the  award  of  the

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Industrial Court, and dismissed the claim of the  employees. It  held that even if Standing Orders 16 and 17 covered  the case, the decision in Digambar Ramachandra’s case (1)  could not now be applied because of the provisions of s. 40(2) and the  addition of Sch. 111, item 7 in the  Bombay  Industrial Relations  Act, which provisions did not find place  in  the Bombay (1) [1949] F.C.R. 321.    (2) [1955] 1 S.C.R 991. (3) [1949] 52 Bom.  L.R. 46 235 Industrial  Disputes Act, 1938, under which the decision  of the  Bombay  High Court was given.  The  Appellate  Tribunal referred  to the Federal Court decision cited  earlier,  and observed  that  there  was  no  doubt  that  the  award   of compensation  to  workmen equal to half of their  wages  and dearness  allowances  was  fair  and  just.   The  Tribunal, however, felt compelled by the decision of this Court in the Muir Mills case (1) to reject the claim of the workers,  and allowed  the  appeal.   In  this view  of  the  matter,  the Appellate  Tribunal  did  not decide whether s.  II  of  the Bombay  Electricity (Special Powers) Act, 1946,  barred  the grant of compensation. The  appellant  in this case first contended that  the  Muir Mills case (1) did not apply, and further that if that  case was  out of the way, then in view of the other  findings  of the  Appellate Tribunal and s. 7 of the Industrial  Disputes (Appellate  Tribunal)  Act, 1950, the appeal ought  to  have failed, since no question of law survived and the  Appellate Tribunal was incompetent to reverse the decision.  The  Mill Owners’  Association, on the other hand" contended that  the opinion  of the Appellate Tribunal that the Muir Mills  case (1)  applied,  was  correct,  that  s.  II  of  the   Bombay Electricity  (Special Powers) Act barred these  proceedings, and  that, in view of the fact that the closure was  due  to force  majeure  for which the Milks  were  not  responsible, Standing  Orders  16  and  17  were  determinative  of   the relations between the parties and the claim for compensation was  not entertainable.  Other objections raised before  the Appellate Tribunal were not pressed before us. We begin first with the question whether s. 11 of the Bombay Electricity (Special Powers) Act, 1946 barred the reference. That section reads as follows: "  11 (1).  No suit, prosecution or other  legal  proceeding shall  lie against any person for anything which is in  good faith done or intended to be done in pursuance of any order, direction  or requirement made or deemed to have  been  made under section 3, 4, 5, 6, 6A, 6B or 6C." (1)  [1955] 1 S.C.R. 991. 236 The  order which was made in this case by the Government  of Bombay was under sub-s. (1) of s. 6A, which reads: " 6A(1).  Notwithstanding anything contained in any law  for the  time  being in force, or any permission  granted  under sub-section (3) of section 5 or any instrument having effect by  virtue of any law, the Provincial Government may with  a view to controlling distribution, supply, consumption or use of electrical energy make an order- (a)for   prohibiting   or  regulating  subject   to   such conditions as it may specify in the, order,-the distribution or supply of electrical energy by a licensee or use of  such energy  by  a  consumer for-any purpose  specified  in  such order; (b)  for determining the order of priority in  which,or  the period  or  periods during which, work shall be done  by  an undertaking to which the supply of electrical energy is made

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by a licensee." It was contended by the respondents that sub-s. (1) of s. 11 quoted  above barred the remedy of arbitration, because  the closure of the Mills was in good faith, and was in pursuance of  a  direction or order made under s.  6A(1).   Mr.  Kolah referred  to the scheme of the Bombay  Electricity  (Special Powers)  Act,  and specially to the  sections  dealing  with penalties  and  offenses and contended that the  Mills  were helpless  and  were  compelled to  close  down  their  esta- blishments  for  part  of the time.   He  claimed  that  the protection  of s. 11(1) was available’ to them., and  argued that it gave immunity from action of any kind. The present proceedings are for compensation for, the period during which the Mills remained closed.  This claim is  made by the workers against the Mills.  The section which confers immunity bars proceedings &rising from the interference with the supply of electrical energy and its consumption.  It  is a  protection to the supplier of electrical  energy  against the consumer and vice versa, and protects also those who act to enforce the order.  There is no complaint here about  the reduction  of electricity or even about the closure  of  the Mills for part of the time.  Neither the 237 Mills  nor  the  workers have raised  any  such  contention. Further,  the  sub-section is a protection clause  which  is usually introduced in an Act, where it gives new or  unusual powers,  and is designed to give immunity to persons  acting under  or enforcing it.  The ambit of the protection  is  in relation to the supply and consumption of electricity  which alone  are curtailed by the order issued- under s. 6A(1)  of the  Act.  The protection conferred by the first  subsection of  s.  11 does not, therefore, prevent the  raising  of  an industrial  dispute resulting in an award for the  equitable sharing  of  loss which had been occasioned  to.,  both  the employers and the employees by the observance of the order. The contention that the Industrial Court had no jurisdiction to hear the reference because the State Government could not make  it,  was not pressed by the respondents,  and  nothing need, therefore, be said about it.  It was raised in another form,  as  will  appear in the sequel.   Both  the  parties, however, criticised the order of the Appellate Tribunal, the respondents challenging the findings adverse to them.  It is now necessary to deal with these contentions. The  case of the appellant was that the  Appellate  Tribunal had  no  jurisdiction  to interfere with the  order  of  the Industrial  Court,  because  the appeal before  it  did  not involve  a ’,.Substantial question of law and did  not  fall within  any of the eight matters mentioned in s. 7(1)(b)  of the  Industrial  Disputes (Appellate  Tribunal)  Act,  1950, which gave appellate jurisdiction to the Appellate Tribunal. The  appellant referred to cases in which it has  been  held that  the Appellate Tribunal could not interfere  on  facts. It is not necessary to analyse those cases for reasons which we proceed to state. The  Industrial Disputes (Appellate Tribunal) Act  conferred appellate  powers on the Appellate Tribunal, if there was  a substantial  question of law arising from the award, or  the matter   fell   within  eight  enumerated   subjects.    The respondents attempted to bring the matter within cl. (1)  of s.  7(1)(b) that is to say’ " wages ", which is one  of  the eight  subjects.  But there is no question here of wages  as such but of 238 compensation.   Learned  counsel for  the  respondents  also argued  that  a conclusion drawn without  adverting  to  the

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evidence  involved a question of law and a  legal  inference from  proved facts and an appeal thus lay.  He  relied  upon Anglo-Iranian  Oil  Co. (India) Ltd. v.  Petroleum  Workers’ Union (1) and Crompton Parkinson (Works) v. Its Workmen (2). It  may  not be necessary to discuss the matter  at  length, because  even if the subject-matter did not fall within  any of  the  eight enumerated topics, there  was  a  substantial question  of law involved, inasmuch as it was  necessary  to decide  whether a claim for compensation was not  admissible in view of the provisions of the Bombay Industrial Relations Act  and  the  Standing Orders.  It  has  been  pointed  out already  that the failure to continue to employ  labour  was due  to  the  short supply of  electrical  energy,  and  the question   is  whether  in  these  admitted   circumstances, Standing  Orders 16 and 17 read with s. 40(1) and item 9  of Sch.  1 of the Bombay Industrial Relations Act rendered  the employers  immune from a claim for compensation for loss  of wages and dearness allowances.  The respondents claimed that they did, while the appellant maintained that they did  not, and referred to ss. 40(2), 42(4), 73 and 78(1)(A) and item 7 of  Sch.   III  of  the same Act.   This  is  a  substantial question of law, and the appeal was thus competent. The crux of the matter is the provisions of Standing  Orders 16 and 17, which are to be read with s. 40(1) of the  Bombay Industrial Relations Act.  Standing Orders 16 and 17 read as follows 16.The Company may, at any time or times, in the event  of a  fire, catastrophe, breakdown of machinery or stoppage  of the power supply, epidemic, civil commotion or other  cause, beyond  the  control  of the Company, stop  any  machine  or machines  or department or departments, wholly or  partially for  any  period  or periods,  without  notice  and  without compensation in lieu of notice. In  the  event of a stoppage of any  machine  or  department under  this  Order  during  working  hours,  the  operatives affected shall be notified by notices (1) [1951] 2 L.L.J. 770. (2) [1959] SUPP. 2 S.C.R. 936. 239 put  upon notice boards in the department concerned  and  at the time-keeper’s office, as soon as practicable, when  work will be resumed and whether they are to remain or leave  the mill.   The  period  of  detention in  the  mill  shall  not ordinarily  exceed  one hour after the commencement  of  the stoppage.   If the period of detention does not  exceed  one hour,  operatives  so  detained shall not be  paid  for  the period of detention.  If the period of detention in the mill exceeds  one hour, operatives so detained shall be  entitled to receive wages for the whole of the time during which they are  detained in the mill as a result of the  stoppage.   In the case of pieceworkers, the average daily earnings for the previous month shall be taken to be the daily wages. 17.Any  operative played-off Linder Order 16 shall not  be considered  as  dismissed from service, but  as  temporarily unemployed,  and shall not be entitled to wages during  such unemployment  except  to the extent mentioned in  Order  16. Whenever  practicable a reasonable notice shall be given  of resumption of normal work and all operatives playedoff under Order  16, who present themselves for work, when the  normal working   is   resumed,   shall   have   prior   right    of reinstatement." The  argument  of the respondents was-  two-fold:  (1)  that these  two  Standing Orders fully covered a closure  due  to stoppage of power, and (2) that under s. 40(1) of the Bombay Industrial  Relations  Act, 1946, the Standing  Orders  were

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determinative of the relations between the employer and  the employees  in regard to all industrial matters specified  in Sch.  1, which contains the following items :- " 4. Closure or reopening of a department or a section of  a department or the whole of the undertaking" and "  9. Temporary closures of work including playing  off  and rights and liabilities of employers and employees........" They also invoked the decision in Digambar Ramachndra’s case (1),  and added that the position had not been altered  even by the addition of the second sub- (1)  [1949] 52 Bom.  L.R. 46. 240 section to s. 40 in the Bombay Industrial Relations Act. We may at this stage read s. 40: " 40. (1) Standing orders in respect of an employer and  his employees  settled under this Chapter and in  operation,  or where  there  are no such standing  orders,  model  standing orders,  if  any, applicable under the  provisions  of  sub- section  (5)  of section 35 shall be  determinative  of  the relations  between the employer and his employees in  regard to all industrial matters specified in Schedule I. (2)Notwithstanding  anything contained in  subsection  (1) the  State  Government  may  refer,  or  an  employee  or  a representative union may apply in respect of any dispute  of the  nature  referred  to in clause (a) of  paragraph  A  of section 78, to a Labour Court." The  respondents  contended that only the  first  subsection applied,  and  that under Standing Orders 16 and  17  quoted above, no compensation was claimable.  The appellant pointed out  that  the second sub-section excluded  the  first  sub- section, because of the nonobstructive clause with which  it is  prefaced and in view of the position of  the  Industrial Court  as the appellate authority from awards of the  Labour Court,  the  former  was not also bound by  the  first  sub- section or the Standing Orders.  There is some force in  the contention  of the appellant, but, in our opinion,  Standing Orders  16  and 17 do not, in terms, apply to  a  claim  for compensation such as is made here.  Standing Order 16 speaks of stoppage "without notice and without compensation in lieu of notice." The compensation which is claimed by the workers in this case is not in lieu of notice, that is to say, for a period  equal to that in respect of which notice would  have had  to be given.  That period would be before the  date  of closure.   The  Standing Order contemplates those  cases  in which  a  notice  has  to be  dispensed  with  and  then  no compensation  in  lieu  of notice  is  payable.   There  is, however,  here a question of quite a different sort, and  it is not covered by Standing Order 16, even though the closure was  by  reason  of stoppage of power.   Standing  Order  17 speaks of "wages", and 41 241 we  are not concerned with wages here but with  compensation which  is not the same thing as wages.  In this view of  the matter,  Standing Orders 16 and 17 cannot be said  to  cover the   present   facts,   and  they   are   not,   therefore, determinative of the relations between the parties.- The  present  dispute was referred to the  Industrial  Court under s. 73(2) of the Bombay Industrial Relations Act, 1946. That  section  reads  as  follows:"Notwithstanding  anything contained  in  this Act, the State Government  may,  at  any time, refer an industrial dispute to the arbitration of  the Industrial Court, if on a report made by the Labour  Officer or otherwise it is satisfied that- (2)the  dispute  is  not likely to  be  settled  by  other

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means;". The  non-obstante clause clearly shows that in spite of  the other provisions of the Bombay Industrial Relations Act,  an industrial dispute may be referred to the Industrial  Court. An  industrial  dispute as defined in that Act  means  inter alia  any  dispute  or difference between  an  employer  and employee  or  between  employers  and  employees,  which  is connected  with  an industrial matter,  which  includes  all matters  pertaining to non-employment of any  person.   That these workmen were not employed on certain days goes without saying, and thus, there was an industrial dispute concerning their  claim  for  compensation  for  the  period  of   non- employment.   Item  9  of Sch.  1 gave the  power  to  frame Standing  Orders  in relation to  temporary  closures.   The Standing  Orders made covered only compensation in  lieu  of notice  and  wages  for  the  period  of  closure,  but  not compensation  for closure.  In the view which we have  taken of  the  Standing  Orders, it is  not  necessary  to  decide whether item 7 of Sch.  III relates only to compensation for permanent  closure,  or whether item 9 of Sch.  1  gave  the power to make a Standing Order relating to compensation  for temporary closure.  It is enough to say that Standing Orders 16  and  17,  as  they  stand,  do  not  cover  a  case   of compensation for closure. 242 The powers of the Industrial Court under s. 73 of the Bombay Industrial  Relations  Act are very wide,  inasmuch  as  the State  Government  can refer an industrial  dispute  to  it, notwithstanding  anything contained in the Act.  It  was  in view  of this that the objection to the jurisdiction of  the Industrial  Court  was not pressed.  But  the  argument  was advanced in another form to show that Standing Orders 16 and 17  were  determinative and did not  enable  the  Industrial Court  to  decide in any manner except  in  accordance  with those  Standing  Orders.   Reliance  was  also  placed  upon Digambar  Ramachandra’s  case (1), where Chagla,  C.J.,  and Bhagwati,  J., decided that the arbitrator was bound by  the Standing  Orders and could not go outside them.  We  are  of opinion  that Standing Orders 16 and 17 do not apply to  the present facts for reasons already stated, and we express our dissent  from  that decision in so far as it held  that  the Standing  Orders covered a case of compensation for  closure also.   We  note  further  that  in  the  Bombay  Industrial Disputes Act, 1938, there was no item similar to the one  in Sch.   III  of  the Bombay  Industrial  Relations  Act.   In Textile   Labour   Association,   Ahmedabad   v.   Ahmedabad Millowners’  Association, Ahmedabad (2), Sir H. V.  Divatia, Rajadhyaksha,  J.,  and  Mr. D. V. Vyas  (later,  Vyas,  J.) correctly held that the Standing Orders did not cover a case of  compensation  for  loss  of  earnings.   The  head  note adequately  summarises the decision, and may be quoted.   It reads: "  Although  the workers are not entitled  to  demand  their wages  during the period of stoppage of work as that  matter has  been  (sic)  covered by the Standing  Orders  there  is nothing  to  prevent them from giving any notice  of  change demanding  compensation for the loss of their earnings.   It cannot be said that the jurisdiction of the Court is  barred by the provisions of Standing Orders Nos. 16 & 17.".  No doubt, the reference there was under s. 43 of the Bombay Industrial  Disputes Act, 1938; but the provisions of s.  73 of  the Bombay Industrial Relations Act are wide  enough  to cover a reference on the same topic.  We are, therefore,  of opinion that the claim (1) [1949] 52 Bom.  L.R. 46.

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(2) 1946-47 Industial Court Reporter 87. 243 for compensation was not barred by Standing Orders 16 and 17 read with a. 40(1) of the Bombay Industrial Relations Act. The  respondents  further contended that  the  principle  of social justice applied by the Industrial Court and  accepted by  the  Appellate Tribunal could not apply because  of  the decision  of  this Court in the Muir Mills case  (1).   They also  contended  that the case for bonus was  decided  along with the present case and both bonus and dearness allowances were  increased by the Appellate Tribunal in respect  of  38 Mills  and even the remaining 15 Mills which  had  ,suffered loss had given minimum bonus to their workers.  They  argued that  wages  were fair and bonus was  awarded  and  dearness allowance  was  increased, and that the  Appellate  Tribunal took  all this into account in refusing compensation.   They submitted that the Mills suffered heavy losses due to  short working,  and that it was sheer injustice to make  them  pay wages  or compensation for days on which the  Mills  remined closed  and  lost their profits through stoppage  of  normal working. The  Muir  Mills case (1) was concerned with  the  award  of bonus, which is linked with profits.  It was there laid down that  inasmuch  as  the labour  employed  in  an  industrial undertaking is ever changing, the award of bonus can only be from  the  profits to which labour in  any  particular  year contributed  and  labour  cannot  claim  that  profits   and reserves of some other years should be used for the  purpose of  giving  them bonus.  We are not concerned in  this  case with the award of bonus as such, and we need not, therefore, make use of the reasons which appealed to this Court in that case.   The  narrow sphere in which social  justice  demands that  workmen going into forced unemployment should  receive compensation  is  quite different.  Social  justice  is  not based on contractual relations and is not to be enforced  on the  principles  of contract of service.   It  is  something outside  these  principles,  and is invoked  to  do  justice without  a  contract to back it.  Mahajan, J.  (as  he  then was),  observed in Western India Automobile  Association  v. Industrial Tribunal, Bombay (2) as follows: (1) [1955] 1 S.C.R. 991. (2) [1949] F.C.R. 321. 244 "  Adjudication does not, in our opinion, mean  adjudication according  to  the strict law of master  and  servant.   The award of the Tribunal may contain provisions for  settlement of  a dispute which no Court could order if it was bound  by ordinary law, but the Tribunal is not fettered in any way by these  limitations.   In Volume 1 of I Labour  Disputes  and Collective Bargaining’ by Ludwig Teller, it is said at  page 536 that industrial arbitration may involve the extension of an  existing  agreement or the making of a new  one,  or  in general the creation of a, new obligation or modification of old  ones, while commercial arbitration  generally  concerns itself  with the interpretation of existing obligations  and disputes  relating to existing agreements.  In our  opinion, it is a true statement about the functions of an  Industrial Tribunal in labour disputes.  " Here,  what  better measure could have been adopted  by  the Industrial  Court  (which  is  approved  by  the   Appellate Tribunal) than to divide the loss into two parts, one to  be borne  by  the  industrial concerns and  the  other  by  the workmen ? There is no other basis suggested by the one  side or the other.  It was contended that the loss to labour went into  the consideration of the grant of bonus, and that  the

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two cases were heard together.  The Appellate Tribunal  says so. But bonus is to come out of profits and is the share  of labour  in the profits it has helped to earn, to bridge  the gap  between  wages  as  they  are  and  the  living   wage. Compensation in the present context is for loss of wages and dearness  allowance,  and  the  two  cannot  be   considered together on any principle.  There is nothing to show that in spite  of  the  formula which  the  Appellate  Tribunal  had evolved for itself, it took into account some other  factors quite alien to the said formula.  It appears to us that what the Appellate Tribunal really meant to say was that inasmuch as  the  workers  were paid bonus they  should  not  make  a grievance if they lost wages on some of the days, because if compensation  were paid bonus would have had to be  reduced. If  that  is  the  meaning, as it  obviously  is,  then  the question  of  compensation was not decided at all.   In  our opinion, this reasoning was 245 beside the point.  It was wholly immaterial whether  profits were  made  or  losses were incurred in  the  year,  if  the employers  continued to retain the labour force so as to  be available for the days on which the Mills worked. In  our  opinion,  the Appellate  Tribunal  after  giving  a finding  that  a claim for compensation equal to  half   the wages and dearness allowances was just and proper, erred  in holding  that it was not admissible because of the  decision of this Court in the Muir Mills case (1).  That case had  no application to the facts here.  The Appellate Tribunal  also erred in declining to grant compensation on the ground  that since bonus was granted the claim for compensation could not be  entertained.  The case of badli workers does not  appear to have been separately raised, and we see no reason not  to award  them compensation ; but payment of such  compensation will be subject to the same condition, as was imposed by the Industrial Court. In the result, the appeal will be, allowed, the order of the Appellate Tribunal set aside and the order of the Industrial Court  restored.  The respondents shall bear the costs  here and in the Tribunals below. Appeal allowed.