1977 (3) TMI 163 - SC - Indian Laws

Summary

Issues Involved:
1. Delay in adjudication and its impact on industrial peace.
2. Principles for determining gratuity schemes.
3. Financial implications of the gratuity scheme on the appellant.
4. Qualifying period for gratuity.
5. Basis for computation of gratuity.
6. Clarifications and minor adjustments to the tribunal's award.

Detailed Analysis:

1. Delay in Adjudication and its Impact on Industrial Peace:
The judgment begins by highlighting the prolonged delay in resolving the dispute, which spanned 19 years from the initial referral to the Industrial Tribunal in February 1958 to the Supreme Court's decision in 1977. This delay is criticized for being destructive of industrial peace and causing disenchantment with labor jurisprudence. The court emphasizes that "the life of rights is remedies" and stresses the need for a "jurisprudence of ready reliefs" to maintain faith in the legal system.

2. Principles for Determining Gratuity Schemes:
The main contention revolves around whether the correct principles were applied in the gratuity scheme framed by the tribunal. The court notes that the Payment of Gratuity Act, 1972, provides an option for workers to choose between the statutory scheme and the one under the award. The court aims to adjudicate on the correctness of the principles used by the tribunal in light of previous rulings and industrial law canons. The court underscores that "gratuity for workers is no longer a gift but a right" and should be viewed as a form of "distributive justice."

3. Financial Implications of the Gratuity Scheme on the Appellant:
The financial impact of the gratuity scheme on the appellant is deemed insignificant. The total annual impact is around Rs. 3,000, a substantial part of which the management does not object to. The appellant is prosperous enough to distribute dividends around 20% over the years. The court ponders whether it should entertain such cases of less significant financial impact to prevent "docket explosion" and delayed justice.

4. Qualifying Period for Gratuity:
The appellant contended that the qualifying period for earning gratuity should be ten years, as sanctified in some earlier rulings, instead of the five years set by the tribunal. The court rejects this contention, noting that "current conditions must control the tribunal's conscience." The court finds the five-year period realistic given the high unemployment rates and the Payment of Gratuity Act, which also sets a five-year qualifying period.

5. Basis for Computation of Gratuity:
The appellant argued that the basic wage should be the basis for computing gratuity, as opposed to the consolidated wage used by the tribunal. The court notes that the tribunal considered the industry's features, high dividends, and low wages and reached a "prudent judicial resolution." The court emphasizes that "an industrial tribunal must act on a legal horse sense, rather than on juristic abstractions." The Payment of Gratuity Act also uses gross wages, inclusive of dearness allowance, as the basis, reflecting the industrial sense in the country.

6. Clarifications and Minor Adjustments to the Tribunal's Award:
The court provides specific clarifications to eliminate ambiguities in the tribunal's award:
- "Wages" will include basic wages and dearness allowance, corresponding to Sec. 2(s) of the Act.
- Qualifying service is continuous service, counted with reference to completed years, as defined in Sec. 2(c).
- The award will operate from the date of the dispute's reference.
- The expression "due to continued ill-health or on being incapacitated" in clause (a) governs only resignation.
- Other conflicts of construction are resolved in favor of the workmen, considering the trivial amount involved.

The court concludes by directing the appellant to pay Rs. 2,000 in costs, with Rs. 1,000 to be paid to Shri Parekh for assisting the court and the remaining Rs. 1,000 to the President of the Respondent Union. The judgment ends with a call for negotiating settlements to avoid prolonged litigation and promote industrial peace and national production.