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GOVERNEMTN SERVANT CAN'T CLAIM
OVERTIME ALLOWANCE
Govt Servants required To Be at Disposal Of Govt All The Time (Under Factories Act): Supreme Court
[Civil Appeal Nos. ___ of 2023 @ SLP (Civil) Nos.
1891-1900 of 2019]
2. Challenging a common
order passed by the High Court of Judicature at Bombay, in a batch of writ
petitions affirming an order of the Central Administrative Tribunal, holding
that even those employees working as Supervisors are entitled to Double Over
Time Allowance, the Management of the Security Printing & Minting
Corporation of India1 and others have come up with these appeals.
3. We have heard Shri Dhruv
Mehta, learned senior counsel appearing for the appellants and Shri R.K.
Adsure, Shri K. Parameswar and Shri S.S. Deshmukh, learned counsel appearing
for the respondents.
4. The case on hand has a
checkered history with fortunes fluctuating from one side to the other. To the
extent necessary, we shall now trace the history as follows:-
(i) Till the year 2005, the Ministry of Finance,
Government of India had nine production units namely, four India Government
Mints, two Currency Note Presses, two Security Printing Presses and one
Security Paper Mill under its control.
(ii) The transfer of management automatically led to the
transfer of the workforce and along with the assets and liabilities of the nine
production units, the Corporation also inherited some litigation, including the
one on hand.
(iii) Way back in the year 1988, an order dated
21.12.1988 was issued by the Special Officer (Currency & Coinage),
Department of Economic Affairs, Ministry of Finance, Government of India,
directing that the shop-floor and the ministerial staff, falling under the
category of non-gazetted supervisory staff of the Presses and Security Paper
Mill would be compensated for extended hours of work at certain rates. The
order indicated that the category of staff mentioned therein would be entitled
to a special allowance to be paid in lieu of overtime allowance, at the rate of
Rs.600/- per month for working of 9 hours and at the rates of Rs.1,000/- per
month and Rs.1,400/- per month for working of 10 hours and 11 hours
respectively.
(iv) By a subsequent order issued by the Government of
India on 11.4.2000, it was clarified that the staff whose basic pay exceeded
the ceiling limit of Rs.2,200/- per month in the pre-revised scales of pay,
will not be entitled to any overtime allowance.
(v) In the year 1988, a group of eight persons working as
Supervisors, Works Engineer, Section Officer, etc., in the Currency Note Press,
Nashik, filed a writ petition on the file of the High Court of Judicature at
Bombay in Writ Petition No.3150 of 1988, claiming overtime allowance. The writ
petition was transferred to Central Administrative Tribunal in the year 1995.
It was tagged along with a few original applications directly filed before the
Tribunal and by a common order dated 25.7.1997, the Central Administrative
Tribunal dismissed all the applications, on the ground that it had no
jurisdiction to deal with a claim relating to overtime allowance arising under
the Factories Act, 19482.
(vi) Challenging the said order of the Tribunal dated
25.7.1997, a few writ petitions came to be filed on the file of the High Court
of Judicature at Bombay. During the pendency of the writ petitions, one more
group of supervisory employees (A.K. Biswas and 20 others) filed an application
in O.A. No.26 of 2000 on the file of the Central Administrative Tribunal
claiming the same reliefs. This application was also dismissed by the Tribunal
by an order dated 19.1.2001 following the order passed on 25.7.1997 in the
other cases.
(vii) Therefore, A.K. Biswas and 20 others filed a writ
petition on the file of the High Court. By an order dated 27.1.2005, the High
Court remanded the matter (A.K. Biswas and others) back to the Tribunal for a
fresh consideration. After remand, the Tribunal allowed the application filed
by A.K. Biswas and others by an order dated 4.4.2005. But this order was set
aside by the High Court in a writ petition filed by the Union of India, on the
ground that an amendment to Section 70 of the Bombay Shops and Establishments
Act was not considered by the Tribunal. This order of the High Court remanding
the matter back to the Tribunal for a second time was dated 31.1.2006.
(viii) Following the second order of remand passed by the
High Court on 31.1.2006 in the case filed by A.K. Biswas and others, the writ
petitions already pending and arising out of earliest writ petition of the year
1988 were also allowed and the matter remanded back to the Tribunal for a fresh
consideration.
(ix) Unfortunately, after the remand, the Tribunal first
took up for consideration O.A. No.26 of 2000 filed by A.K. Biswas and others
and dismissed the same by an order dated 15.9.2006.
(x) After nearly four years of disposal of the
application filed by A.K. Biswas and others, the Tribunal took up all other
applications, pending from 1995 onwards (and one of which related to the writ
petition of the year 1988 and which got transferred to the Tribunal in the year
1995). By a common order dated 9.6.2010, the Central Administrative Tribunal
held that the applicants therein were entitled to Double Over Time Allowance in
terms of Section 59(1) of the 1948 Act. After holding so, the Tribunal confined
the relief, only to a period of two years prior to the filing of the respective
original applications, insofar as arrears were concerned.
(xi) Aggrieved by the dismissal of their application in
O.A. No.26 of 2000 by the Tribunal by an order dated 15.9.2006, A.K. Biswas and
others filed a writ petition in Writ Petition No.2603 of 2007 on the file of
the High Court.
(xii) In the meantime, the Corporation had come into
existence and, hence, the Union of India as well as the Corporation, along with
the India Security Press and Currency Note Press filed a batch of writ
petitions challenging the second order of the Central Administrative Tribunal
dated 9.6.2010.
(xiii) In other words, the rejection by the Tribunal of
the claim of one set of employees (A.K.Biswas and others) was the subject
matter of one writ petition and the grant of relief by the Tribunal in favour
of the other group of employees was the subject matter of a separate batch of
writ petitions.
(xiv) By a common order dated 28.6.2018, the High Court
of Judicature at Bombay dismissed all the writ petitions filed by the Union of
India and the Corporation. Coming to the writ petition filed by A.K. Biswas and
others, the High Court found that the employees were similarly placed and that
they were entitled to the same benefits as given to the other employees.
However, the High Court found that some of the employees
had already compromised the matter with the Management and that therefore the
relief should be confined only to those employees who had not compromised.
Accordingly, the High Court allowed the writ petition filed by A.K. Biswas and
others, granting relief only to those employees who had not compromised the
matter with the management.
(xv) It is against the said common order passed by the
High Court on 28.6.2018 that the Corporation has come up with the above
appeals.
5. From the narration of
facts provided above, it will be clear that the only question which falls for
our consideration is: as to whether persons employed as Supervisors are
entitled or not, to Double Over Time Allowance in terms of Section 59(1) of the
1948 Act?
6. For coming to the
conclusion that the employees are entitled to Double Over Time Allowance, the
Tribunal started with two presumptions, namely
(i) that the India Security Press, Currency Note Press
and India Government Mint would fall within the definition of the expression
"factory" as defined in Section 2(m) of the 1948 Act; and
(ii) that the employees would fall within the definition
of the expression "worker" as defined in Section 2(l) of the 1948
Act. As a sequitur, the Tribunal held that these Supervisors, will, in the
normal course, be entitled to extra wages for overtime in terms of Section
59(1) of the 1948 Act.
7. But it was argued on
behalf of the Union of India that under Section 64(1) of the 1948 Act, the
State Government was entitled to make Rules exempting the application of the
provisions of Chapter VI of the Act to certain categories of workers.
In exercise of the power conferred by Section 64(1), the
State of Maharashtra had issued a set of Rules known as Maharashtra Factories
Rules, 19633, Rule 100 of which exempted Supervisors from the application of
the provisions of Chapter VI, provided they were not required to perform manual
labour or clerical work as a regular part of their duties. In the light of such
a stand taken by the Union of India, the Tribunal, in the batch of applications
decided on 9.6.2010, framed the following question as arising for consideration:-
"Whether in the facts and in the circumstances of
the cases the applicants in these OAs are entitled to double OTA under Section
59(1) of the Factories Act, even after considering the provisions of Section
64(1) of the Factories Act, 1948 read with the provisions of Rule 100 of
Maharashtra Factories Rule, 1963?"
8. After framing the issue
as aforesaid, the Tribunal recorded a finding that the applicants before the
Tribunal were doing clerical work as a part of their regular duties and that
therefore they were excluded from the application of Rule 100 of the 1963
Rules, in view of the proviso contained therein. In view of the said finding,
the Tribunal held that the applicants before the Tribunal were entitled to
Double Over Time Allowance.
9. In contrast, the very
same Tribunal found in its order dated 15.9.2006 in the original application
filed by A.K. Biswas and others that the applicants before the Tribunal were
not performing any manual labour or clerical work as a regular part of their
duties and that therefore by virtue of Rule 100 of the 1963 Rules, they stood
excluded from the benefit conferred by Section 59(1) of the 1948 Act.
10. Thus, the Central
Administrative Tribunal reached diametrically opposite findings of fact, in two
different sets of cases filed by employees who were identically placed and
discharging identical duties and responsibilities. The reason why we record
this fact is that in normal circumstances, the High Court exercising
supervisory jurisdiction under Article 226/227 and this Court exercising
jurisdiction under Article 136, will not be inclined to interfere with the
findings of fact recorded by a Tribunal. But in this case, there are two
diametrically opposite set of findings, both of which cannot co-exist.
11. Keeping the above aspect
in mind, let us now proceed to consider the rival contentions.
12. Shri Dhruv Mehta,
learned senior counsel appearing for the appellants contended,
(i) that a perusal of the list of duties assigned to the
respondents, as reflected by the ACRs clearly show that the respondents were
performing supervisory duties, exercising control over 50 to 100 workers;
(ii) that as per the law laid down by this Court in
Burmah Shell Oil Storage and Distribution Company of India Ltd. vs. The Burma
Shell Management Staff Association & Ors.4, a person whose predominant
nature of work is supervisory, will not be qualified as a workman merely
because he also carries on clerical/mechanical work incidental to his
supervisory work;
(iii) that the Tribunal as well as the High Court failed
to appreciate the scope of Rule 100 of the 1963 Rules in the proper
perspective; and (iv) that the Supervisors enjoying higher scales of pay than
workers, cannot claim the benefit of overtime allowance as extended to workers.
13. In response, it is
contended by Shri K. Parameswar, learned counsel appearing for the respondents,
(i) that the decision in Burmah Shell Oil Storage and
Distribution Company of India Ltd. (supra) cannot have any application to the
case on hand, since the definition of the expression "workman" under
the Industrial Disputes Act, 19475 is quite different from the definition of
the same expression under the 1948 Act;
(ii) that therefore the dominant nature test propounded
in Burmah Shell Oil Storage and Distribution Company of India Ltd. is not
applicable here;
(iii) that the Tribunal and the High Court have found on
evidence that the respondents are performing manual labour or clerical work as
a regular part of their duties and, hence, Rule 100 of the 1963 Rules has no
application; and
(iv) that the findings of fact recorded by a
quasi-judicial tribunal cannot be interfered with lightly.
14. Shri S.S. Deshmukh,
learned counsel appearing for some of the respondents contended,
(i) that the proviso to Section 64(1) of the 1948 Act
carves out an exception, in the case of persons drawing rate of wages not
exceeding the limit specified in Section 1(6) of the Payment of Wages Act,
19366, insofar as the claim for extra wages for overtime work is concerned;
(ii) that therefore Rule 100 of the 1963 Rules has no
application to the case of the respondents in view of the said proviso to
Section 64(1); and
(iii) that the Central Administrative Tribunal itself had
passed orders in several applications, in favour of employees identically
placed and working as Supervisors, the details of which are provided in
paragraph 5 of the counter affidavit filed by A.K. Biswas in the above appeals
and that therefore the orders of the Tribunal and the High Court do not call
for any interference.
15. We have carefully
considered the rival contentions.
16. At the outset, it should
be noted that the claim of the respondents for payment of Double Over Time
Allowance arose entirely during the period from 1988 to 2005. Since the
'Corporation' was incorporated only on 13.1.2006 and all the nine production
units coming under the control of the Currency and Coinage Division of the
Department of Economic Affairs, Ministry of Finance, Government of India were
transferred to the Corporation only with effect from 10.2.2006, the claim of
the respondents obviously arose at the time when they were Central Government
servants. In other words, their claim should be considered to have arisen only
in relation to "service matters" of persons appointed to "a
service in connection with the affairs of the Union" or in relation to
"holders of civil post."
17. The definition of the
expression "service matters", is provided in Section 3(q) of the
Administrative Tribunals Act, 19857 and it reads as follows:-
"3. Definitions.- In
this Act, unless the context otherwise requires,-
(q) "service matters", in relation to a person,
means all matters relating to the conditions of his service in connection with
the affairs of the Union or of any State or of any local or other authority
within the territory of India or under the control of the Government of India,
or, as the case may be, of any corporation or society owned or controlled by
the Government, as respects-
(i) remuneration (including allowances), pension and
other retirement benefits;
(ii) tenure including confirmation, seniority, promotion,
reversion, premature retirement and superannuation;
(iii) leave of any kind;
(iv) disciplinary matters; or
(v) any other matter whatsoever;"
18. It is seen from
sub-clause (i) of clause (q) of Section 3 extracted above that any issue
relating to remuneration including allowances, is a service matter. The
respondents herein, at least during the period from 1988 till the year 2006,
were either holders of civil posts under the Union or appointed to the civil
services of the Union.
19. This is why the
respondents approached the Central Administrative Tribunal, for the
adjudication of their service matter. The respondents did not go either before
the Labour Court constituted under the 1947 Act or before the Authorities
empowered under other labour welfare legislations, despite Section 28 of the
1985 Act not excluding the jurisdiction of the Industrial Tribunal or the
Labour Court. Keeping this in mind, let us now address a more fundamental
question.
20. Primarily, the terms and
conditions of service of persons in the civil services of the Union or the
State and persons holding civil posts under the Union or the State, are
regulated either by the Acts of the appropriate Legislature passed in terms of
Article 309 or by the Rules framed in exercise of the power conferred by the
proviso to Article 309 of the Constitution.
Therefore, whenever a dispute relating to a service
matter, which includes a claim for allowances, is raised before the
Administrative Tribunal, the primary duty of the Tribunal is to see what is
provided by the relevant Act issued under the main part of Article 309 or the
Rules issued under the Proviso to Article 309.
21. It must be kept in mind
that appointment either to a civil post or in the civil services of the Union
or the State, is one of a status. It is not an employment governed strictly by
a contract of service or solely by labour welfare legislations, but by statute
or statutory rules issued under Article 309 or its proviso.
22. In fact, the history of
civil service in India is more than a century old and there were Rules in
force, such as the Fundamental Rules and the Supplementary Rules (FRSR) issued
way back in the year 1922, with effect from 1.1.1922. Article 313 of the
Constitution declares that until other provision is made under the
Constitution, all the laws in force immediately before the commencement of the
Constitution and applicable to any public service or post, shall continue in
force. This is why the Fundamental Rules of the year 1922 continue to apply
even now, to the holders of civil posts and those in the civil services of the
Union or the State.
23. It must also be borne in
mind that there are three different categories of employment, if not more, in
the country. They are, (i) employment which is statutorily protected under
labour welfare legislations, so as to prevent exploitation and unfair labour
practices; (ii) employment which falls outside the purview of the labour
welfare legislations and hence, governed solely by the terms of the contract;
and (iii) employment of persons to civil posts or in the civil services of the
Union or the State. Any Court or Tribunal adjudicating a dispute relating to
conditions of service of an employee, should keep in mind the different
parameters applicable to these three different categories of employment.
24. Unlike those employed in
factories and industrial establishments, persons in public service who are
holders of civil posts or in the civil services of the Union or the State are
required to place themselves at the disposal of the Government all the time.
Rule 11 of the Fundamental Rules reads as under:-
"Unless in any case it be otherwise distinctly
provided, the whole time of a Government servant is at the disposal of the
Government which pays him, and he may be employed in any manner required by
proper authority, without claim for additional remuneration, whether the
services required of him are such as would ordinarily be remunerated from
general revenues, from a local fund or from the funds of a Body incorporated or
not, which is wholly or substantially owned or controlled by the
Government."
25. In the light of the
above Rule, there was actually no scope for the respondents to seek payment of
Double Over Time Allowance. It is needless to say that no benefit can be
claimed by anyone dehors the statutory rules. Unfortunately, the Central
Administrative Tribunal completely lost sight of those Rules, and the
distinction between employment in a factory and employment in Government
service, despite the Union of India raising this as a specific issue in
paragraph 12 of the counter filed in O.A. No.428 of 2005 before the Central
Administrative Tribunal.
26. The claim of the
respondents before the Tribunal was not based on any statutory rule but based
entirely upon Section 59(1) of the 1948 Act.
27. Persons who are not
holders of civil posts nor in the civil services of the State but who are
governed only by the 1948 Act, may be made to work for six days in a week with
certain limitations as to weekly hours under Section 51, weekly holidays under
Section 52, daily hours under Section 54, etc.
Workers covered by Factories Act do not enjoy the benefit
of automatic wage revision through periodic Pay Commissions like those in
Government service. Persons holding civil posts or in the civil services of the
State enjoy certain privileges and hence, the claim made by the respondents
ought to have been tested by the Tribunal and the High Court, in the proper
perspective to see whether it is an attempt to get the best of both the worlds.
28. Admittedly, the State
Government is conferred with the power under Section 64(1) to make exempting
Rules. In exercise of the power so conferred, the State of Maharashtra has
framed Rule 100, which reads as follows:-
"Rule - 100:
PERSONS DEFINED TO HOLD POSITION OF SUPERVISION OR EMPLOYED IN A CONFIDENTIAL POSITION.
(1) In a factory the following persons shall be deemed to
hold position of supervision or management within the meaning of sub-section
(1) of section 64, provided they are not required to perform manual labour or
clerical work as a regular part of their duties namely:
(i) The Manager, Deputy Manager, Assistant Manager,
Production Manager, Works Manager and the General Manager;
(ii) Departmental Head, Assistant Departmental Head,
Departmental in-charge or Assistant Departmental in-charge;
(iii) Chief Engineer, Deputy Chief Engineer and Assistant
Engineer;
(iv) Chief Chemist, Laboratory incharge;
(v) Personnel Manager, Personnel Officer;
(vi) Labour Officer, Assistant Labour Officer;
(vii) Welfare Officer, Additional Welfare Officer or
Assistant Welfare Officer;
(viii) Safety Officer;
(ix) Security Officer;
(x) Foreman, Chargeman, Overseer and Supervisor;
(xi) Jobber in Textile Factories;
(xii) Head Store Keeper and Assistant Store Keeper;
(xiii) Boiler Sarang or such Boiler Attendants who are
in-charge of a battery of boilers and are only required to do supervisory work;
(xiv) Any other person who in the opinion of the Chief
Inspector, holds a position of supervision or Management and is so declared in
writing by him."
29. Apparently, the post of
Supervisor is included in Rule 100, as a post exempted from the application of
the provisions of Chapter VI.
30. But the claim of the
respondents is that the proviso embedded in Rule 100(1) makes the exemption
inapplicable to those who are required to perform manual labour or clerical
work as a regular part of their duties.
31. On a question of fact as
to whether the respondents are required to perform manual labour or clerical
work as a regular part of their duties, the Tribunal has reached diametrically
opposite conclusions, one in the case of A.K. Biswas and others and the other
in the case of remaining set of employees.
33. The High Court fell into
an error in holding that the performance of certain functions, such as setting
right malfunctioning of feeder, side-lay, double-sheet detector, photocell,
etc., to ensure uninterrupted running of the machinery, are manual functions.
But we do not think so.
34. In any case, the
respondents, who are holders of civil posts or in the civil services of the
State till the year 2006, could not have claimed the benefits of the provisions
of Chapter VI of the 1948 Act, dehors the service rules.
35. Though the decision in
Burmah Shell Oil Storage and Distribution Company of India Ltd. is heavily
relied upon by Shri Dhruv Mehta, learned senior counsel appearing for the
appellants, we do not think that the same has any application to the case on
hand. This is for the reason that the definition of "workman" in
Section 2(s) of the 1947 Act specifically excludes persons employed in a
supervisory capacity. But such an exclusion is not there in the definition of
the very same word "worker" in Section 2(l) of the 1948 Act.
36. The distinction can be
well understood if these definitions are presented in a tabular form side by
side:-
|
Definition of "workman" in Section 2(s)
of the Industrial Disputes Act, 1947 |
Definition of "worker" in Section 2(l)
of the Factories Act, 1948 |
|
2. Definitions.- In
this Act, unless there is anything repugnant in the subject or context,- xxx
xxx xxx |
2. Interpretation.- In this Act, unless there is anything repugnant in
the subject or context,- xxx xxx xxx |
37. Sub-clause (iv) of
clause (s) of Section 2 of the Industrial Disputes Act, 1947, is conspicuously
absent in the corresponding provision in the 1948 Act. Therefore, we would not
place our conclusion on the basis of the decision in Burmah Shell Oil Storage and
Distribution Company of India Ltd.
38. Similarly, the argument
of Shri S.S. Deshmukh, learned counsel appearing for the respondents based upon
the proviso to Section 64(1) of the 1948 Act read with Section 1(6) of the 1936
Act, cannot distract our attention. In any case, Section 1(6) of the 1936 Act
as it stood before the Amendment Act 41 of 2005 which came into effect on
9.11.2005 reads as follows:-
"1. Short title, extent, commencement, and application.
-
(6) Nothing in this Act shall apply to wages payable in
respect of a wage-period which over such wage-period, average one thousand six
hundred rupees a month or more."
39. But in the case on hand,
the distinction made by the Government of India in their Office Order dated
21.12.1988 related to persons drawing a basic pay of more than Rs.2,200/-.
Therefore, the provisions of the Payment of Wages Act, were not applicable to
the respondents herein and as a sequitur, the Proviso to Section 64(1) of the
1948 Act cannot be pressed into service.
40. Thus, we find (i) that
the Tribunal as well as the High Court did not consider the distinction between
persons in Government service and those in private service and the effect of
the statutory rules upon the conditions of service of the respondents,
including their liability to work for extra hours; (ii) that the Tribunal
reached diametrically opposite findings of fact in respect of persons holding
similar supervisory posts; and (iii) that therefore, the orders of the Tribunal
and the High Court are unsustainable.
41. In view of the above,
all the appeals are allowed and the impugned order of the High Court is set
aside. However, we find that some of the employees have retired, some have
passed away and in respect of some who have passed away, the appeals have been
abated.
Therefore, even while allowing the appeals and setting
aside the impugned order of the High Court, we direct the appellants not to
effect any recovery from those to whom payments have already been made. No
order as to costs.
......................J. (V. Ramasubramanian)
......................J. (Pankaj Mithal)
New Delhi: April 18, 2023
1 For short, "Corporation"
2 For short, "1948 Act"
3 For short, "1963 Rules"
4 1970 (3) SCC 378
5 For short, "1947 Act"
6 For short, "1936 Act"
7 For short, "1985 Act"
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