High Court
Legal Reasoning
WP-11223-2024+.odtIN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABAD903 WRIT PETITION NO. 11223 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTD THROUGH ITS CHAIRMANVERSUSGAUTAM RAOSAHEB INGALE AND ANOTHERAND904 WRIT PETITION NO. 11225 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTDVERSUSVIJAYKUMAR PANDITRAO SURYAWNASHI AND ANOTHERAND905 WRIT PETITION NO. 11234 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTDVERSUSSUDARSHAN VISHNU TAMBEAND906 WRIT PETITION NO. 11235 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTDVERSUSGUNWANT SAHEBRAO SHERKAR AND ANOTHERAND907 WRIT PETITION NO. 11236 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTDVERSUSMAHADEV SITARAM GAIKWAD AND ANOTHERAND908 WRIT PETITION NO. 11237 OF 2024UmeshPAGE 1 OF 14
Legal Reasoning
WP-11223-2024+.odtMAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTDVERSUSPANDIT BABURAO GUNDRE AND ANOTHERAND909 WRIT PETITION NO. 11262 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTDVERSUSSANTOSH SHANKARRAO MORE AND ANOTHERAND910 WRIT PETITION NO. 11265 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTDVERSUSRAM DASHRATH KADAM AND ANOTHERAND911 WRIT PETITION NO. 11274 OF 2024MAHARASHTRA STATE ELECTRICITY BOARD STAFF CO OPERATIVECREDIT SOCIETY LTD THROUGH ITS CHAIRMANVERSUSAYUB BABUKHAN PATHAN AND ANOTHER***• Mr. P. R. Katneshwarkar, Senior Advocate i/by Mr. V.S. Undre, Advocate for the Petitioners• Mr. S. S. Jadhavar, Advocate for Respondent No. 1***CORAM:R. M. JOSHI, JDATE:MARCH 19, 2025PER COURT : 1.These Petitions take exception to the judgmentand order dated 07.08.2024 passed by the IndustrialCourt, Latur in Complaints ULP No. 107/2016 wherebyUmeshPAGE 2 OF 14 WP-11223-2024+.odtIndustrial Court has granted following reliefs:“1)Complaint is allowed with cost as under.2)It is declared that respondents haveindulged in unfair labour practices withinthe meaning of Item 6 and 9 of Sch. IV ofM.R.T.U. and P.U.L.P. Act, 1971 and they aredirected to cease and desist from the saidact of unfair labour practice.3)Respondents are directed to conferpermanency on complainant on completion of240 days in service from the date of hisappointment i.e. 17.03.1996 and to releaseall the consequential benefits within twomonths.4)Respondents are directed to make payment orarrears towards benefits of 5th & 6th PayCommission, D.A. and H.R.A. as madeapplicable to the complainant within twomonths.5)xxx”2.At the outset, learned Senior Counselappearing for the Petitioners, on instructions, makesstatement that the Petitioners though have filedPetitions taking exception to the entire order,challenge to the impugned order is restricted to theextent of direction to make payment of arrears towardsbenefits of 5th and 6th pay commission. In view of theUmeshPAGE 3 OF 14
Decision
WP-11223-2024+.odtsaid statement, challenge to the impugned order isrestricted in these Petitions to that extent.3.Parties are referred to as ‘workmen’ and‘society’ for the sake of convenience.Workmen filed complaint ULP No. 107/2016 underSection 28(1) of the Maharashtra Recognition of TradeUnions and Prevention of Unfair Labour Practices Act,1971 (for short ‘the Act’) read with Scheduled IV, itemnos. 5, 6, 9 and 10 for seeking permanency oncompletion of 240 days of service and benefits of 5thand 6th pay commission with arrears and consequentialreliefs. Workmen claim to be employed with society fromtheir respective dates of appointments as mentioned inthe complaint. It is claimed that they are doingpermanent nature of work. It is the case of the workmenthat society is involved in the business of lendingmoney i.e., loan to the members and also acceptsdeposits from them. It is the case of the workmen thatregulation rules are framed by the Society whereby asper the clause no. 6 workmen of the society areentitled for the dearness allowance and house rentallowance as declared by the Government of MaharashtraUmeshPAGE 4 OF 14 WP-11223-2024+.odtfrom time to time. It is further averred in thecomplaint that after implementation of the 6th paycommission to the employees of the State Government allworkmen made representation to the society for increasein their salary. Similarly claim was raised with regardto the 6th pay commission so also arrears of 5th paycommission. It is also claimed that workmen have workedfor more than 240 days of continuous service and sincethey are performing regular nature of work, they areentitled for permanent status and permanency. Withthese averments, following reliefs are sought : ^^1-rdzkjnkjkph rdzkj eatwj djkoh o lkeusokyk ;kus vuqphrdkexkj izFkspk voyac dsyk vkgs vls tkghj d:u R;kl dk;epkizfrca/kkRed vkns’k lkeusokyk ;kaP;k fo:/n Ogkok-2-rdzkjnkjkP;k lsosyk 240 fnol >kysY;k rkj[ksiklwu R;kl lsosrdk;e d:u lsokfu;ekrhy rjrwnhuqlkj vkf.k egkjk”Vª ‘kklukP;kdeZpk&;kizek.ks R;kl lgkok osru vk;ksx ykxw dj.;klaca/kh rlsp ikpO;ko lgkO;k osru vk;ksxkrhy Qjdkrhy jDde :- 919432 o brj loZvkfFkZd ykHk feG.ksckcr ;ksX; rs vkns’k lkeusokyk ;kaP;k fo:/n ikfjrdjkosr-3-;k rdzkjhpk [kpZ :- 5000@& ;kauh rdzkjnkjkl ns.;kckcr ;ksX; rksgqdwe djkok-4-;k U;k;ky;kl ;ksX; okVrhy vls vkns’k ikfjr djkosr-**4.Society filed written statement denying thecontentions of the Plaintiff however it is acceptedthat the workmen are working with the society asUmeshPAGE 5 OF 14 WP-11223-2024+.odtclaimed however it is denied that they were workingcontinuously. It was the contention of the society thatsince society is registered under the MaharashtraCooperative Societies Act, the Registrar under the saidAct would be competent Authority to decide the issueand that the society is not covered by the provisionsof Industrial dispute Act. Though it is accepted thatthe society is engaged in the business of receivingbenefits and advancing loans to the members however itis denied that the workmen are working onpermanent/perineal posts. It is further denied that theworkmen are entitled for benefits of 6th pay commissionor the arrears of 5th pay commission. It is alsocontended that in February, 1980 the society was formedwith 181 members. Till 1985 the functioning of theSociety was done in appropriate manner, however, lateron Administrator was appointed. For the year 1985-1986also Administrator was appointed who without followingdue process of law has made appointments of theworkmen. It is also alleged that 4th pay commission wasmade applicable to the workmen in collusion with them.It is specifically contended that considering financialposition of the society, it is not possible to extendUmeshPAGE 6 OF 14 WP-11223-2024+.odtthe benefits of pay commissions as sought by theworkmen.5.Learned Industrial Court after taking intoconsideration service rules of the society and moreparticularly, clause nos. 6, 24 and 25, has held thatthe workmen are entitled for benefits of 5th and 6th paycommission at par with the State Government employees.With these observations, impugned order came to bepassed.6.Though in the written statement before theIndustrial Court various other issues are raisedincluding the issue of maintainability of thecomplaints, non application of the provisions ofIndustrial Disputes Act, so also the workmen notperforming the permanent nature of work and having notcompleted 240 days of continuous work, in view of thestatement made by the learned Senior Counsel for thePetitioner on instructions, the challenge in thesePetitions to the impugned order is restricted asindicated above. This Court, therefore, does not findit necessary to go into the other issues.UmeshPAGE 7 OF 14 WP-11223-2024+.odt7.Learned Senior Counsel appearing for theSociety submitted that the Industrial Court hascommitted serious error in interpreting rules 6, 22 and25 applicable to the Society. He drew attention of theCourt to the relevant rules in order to contend thatwhat was entitled by the workmen of the Society was DAand HRA as declared by the Government of Maharashtrafrom time to time. Similarly, as per rule 24 travelingallowance and daily allowance also would be at par withthe Government employees. He specifically referred torule 25 in order to contend that it was only for thepurpose of creation of cadres and pay scales, it wasnot decided to apply the pay scales as per theGovernment employees. According to him, there isspecific statement to that effect. It is his submissionthat if at all salary was to be paid as per Governmentemployees, there was no reason for specifying thecadres i.e., Manager, Senior Clerk, Junior Clerk, Peon,Driver, etc. It is his submission that the IndustrialCourt has misinterpreted the said rules. It isspecifically argued that for the purpose of decidingthe enhancement of the pay, it was incumbent on thepart of the Industrial Court to take into considerationUmeshPAGE 8 OF 14 WP-11223-2024+.odtthe financial condition of the employer and in thiscase without going into the same, order came to bepassed directing the application of 5th and 6th paycommission to the workmen of society. It is hissubmission that if said misinterpretation is permittedto be done and the society which is a private employerand not Government aided institute cannot sustain withthe financial burden which would come with applicationof pay commissions as declared by the Government. Insupport of his submissions, he placed reliance on thejudgment of Hon’ble Supreme Court in case of PunjabState Cooperative Milk Producers Federation Limited andAnother vs. Balbir Kumar Walia and Others, (2021) 8 SCC784. 8.Per contra, learned Counsel for Workmenvehemently supported the impugned order. In thisregard, he has made reference to the resolution passedby the Society granting benefits of 6th pay commissionbut from 08.09.2005. It is his submission that once 5thpay commission is made applicable, the same isnecessarily be made applicable from the date on whichit came into effect i.e., 01.01.1996. It is his furtherUmeshPAGE 9 OF 14 WP-11223-2024+.odtsubmission that the service rules are more sufficientlyindicate about the applicability of the pay scale andsalary of the workmen at par with the Governmentemployees. He has placed reliance on the Resolutiondated 29.07.2005 passed by the Society in respect ofapplication of 4th and 5th pay commission to the workmen.Finally, it is his submission that if pay commission isnot made applicable, the salary of the employees wouldbe stagnant and that they are likely to be affectedadversely.9.The entire issue with regard to theapplicability of 6th pay commission and entitlement ofthe arrears of 5th pay commission would depend upon theservice rules applicable to the workmen of the Society.Perused the rules. At the outset, it needs to bementioned that in the entire rules there is no ruleindicating application of the same salary as paid tothe State Government employees. If it was so, there wasno reason to mention in rule 6 about HRA and DA to bemade applicable as declared by the State Governmentfrom time to time. Similarly TA and daily allowance isalso same to be paid at par with State GovernmentUmeshPAGE 10 OF 14 WP-11223-2024+.odtemployees. Except for these four heads, there is norule provided for the employees of the Society gettingpay at par with the Government employees. If the rulesintended to be made for Government pay scalesapplicable to the workmen, there was no need forintroducing such specific heads for this purpose.Coming to rule 25, it is relevant to note that theserules were framed at the time of inception of theSociety. Classification of the employees is done andfor the purpose of deciding their pay scale at thatstage, it was recorded that pay scale would be infollowing manner:^^25-lsok izos’k fu;e & deZpk&;kaps [kkyhyizek.ks oxhZdj.k Js.khjkgrhy-1- eWustj @ O;oLFkkid12- ojh”B fyihd13- dfu”V fyihd9 iSdh ejkBh baxzrh Vk;ihLV nksu4- f’kikbZ@fMysOgjh ckW;45- okgu pkyd1vlk ,dq.k lksGk tkxk jkgrhy] T;kosGh laLFksps O;ogkj ok<rhyR;kosGh o dk;Zdkjh eaMGkyk vko’;drk okVY;kl tkxk ok<owu fdaokfjdkE;k gks.kk&;k tkxsoj use.kqdk dsY;k tkrhy v’kk tkxk Hkj.;kpk iw.kZvf/kdkjh laLFksP;k psvjeuyk jkghy o R;kl ftYgk mi&fuca/kdkph iwoZijokuxh vko’;d vkgs o egkjk”Vª ‘kklukP;k deZpk&;kaizek.ks [kkyhyosruJs.kh jkghy- 1- eWustj & 1400&40&1600&50&2300 bZ-ch-&60&26002- ojh”B fyihd & 1200&30&1560& bZ-ch-&40&2040UmeshPAGE 11 OF 14 WP-11223-2024+.odt3- dfu”B fyihd & 950&20&1150&b-vh-&25&15004- lsod & 950&20&1150&b-ch-&14&9405- okgu pkyd & 950&20&1150&b-ch&25&1500dW’k gWMy ¼gkrkG.kh½ dj.kk&;k deZpk&;kl vykamUl njegk :-50@& tknk ns.;kr ;sbZy-**10.This indicates that the intention was to havesome basis for classification as well as settlinginitial pay scales of the workmen. Clause no. 5 doesnot say that the pay scale of the workmen would beenhanced/altered as declared by the State Governmentfrom time to time. Absence of such specific provisionsclearly shows that it was never intended to pay salaryat par to the Government employees. The IndustrialCourt has totally misinterpreted the said rules, whichhas resulted into passing of the perverse order.11.The law on the point of pay revision isabsolutely settled to say that the financial positionof the employer is most important and essentialcondition which is required to be taken into account byany Court while allowing the enhancement of the salary.Even while deciding the industrial dispute and byapplying the principles of industry cum region, theUmeshPAGE 12 OF 14 WP-11223-2024+.odtconsideration of financial condition of the particularemployer is paramount. The Industrial Court has totallyfailed to take into account the fact that the Societyis private employer and not aided by the Government. Insuch circumstances, granting benefits of 5th and 6th paycommission as sought by the workmen would result intoinability of the Society to take up such financialburden. Unless the Industrial Court had considered thefinancial position of the Society and when there was nounambiguous terms in the service condition of theworkmen about applicability of the pay commissionsdeclared by the Government, there remains nojustification for passing any order like impugned orderherein this case.12.The Society, therefore, has not committed anyunfair labour practices by not paying the arrears of 5thpay commission and by not making applicable benefits of6th pay commission to the workmen. Since no unfairlabour practice is committed in this regard, questionof directing Society to desist the same does notarise. Consequentially, the order of directing benefitsof 5th pay commission and 6th pay commission cannotUmeshPAGE 13 OF 14 WP-11223-2024+.odtsustain.13.As far as the apprehension/grievance made bythe Counsel for the workmen about the stagnant in thesalary of the workmen is concerned, it is open for theworkmen to raise their charter of demand and inaccordance with provision of the Industrial DisputesAct, these issues can be raised before appropriateauthorities and if required finally before theIndustrial Tribunal. In such circumstances, the workmenare not remediless as sought to be canvassed.14.Hence, even though this Court has causedinterference in the impugned order to above extent, theright of the workmen to raise charter of demand and topursue the same would not get affected in any mannerwhatsoever.15.As a result of above discussion, Petitionsstand partly allowed. Order dated 07.08.2024 passed bythe Industrial Court to the extent of grant of 5th and6th pay commission in clause no. 4 of the said orderstands set aside. (R. M. JOSHI, J.) UmeshPAGE 14 OF 14