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TMI Blog2010 (2) TMI 1246X X X X Extracts X X X X X X X X Extracts X X X X ..... nt per annum for the period 30th September, 1992 to 14th March, 2003. 3. Mr.Patil, the learned counsel appearing on behalf of the Respondent opposed the Petitioner's application for interest on the following grounds : i). The application under Section 33-C(2) was filed after considerable delay. ii). The application is not maintainable as there was no employer employee relationship between the parties at the relevant time. iii). The Petitioner failed to furnish any evidence in support of the application. iv). The application is barred by res-judicata and/or principles analogous thereto. v). There is no legal basis for the grant of interest. I have answered each of the submissions in the negative, against the Respondent. 4. Mr.Patil's fifth defence raises a question of law of some importance. The question of law that arises is whether the Labour Court has power under Section 33-C(2) to order an employer to pay the employee interest for the period between the date of an order of a Court or Tribunal or authority for payment and the date of payment. I have answered the question in the affirmative upholding the claim for interest in such cases on four g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present application under section 33C(2) suffered from gross delay and latches. 7. To uphold this contention would be a traversity of justice. It would put a premium on the entirely unreasonable and, in fact, contumacious conduct of the Respondent in not merely having failed and neglected to comply with the order dated 30th September, 1992, but having wilfully and contumaciously refused to comply with the same despite the fact that the order had been upheld by a learned single Judge and by the Division Bench of this court. It was only under pain of the contempt proceedings that the order was complied with. It is pertinent to note that the present application under Section 33-C(2) was filed on 11th August, 2003, i.e. within five months of the amount having been paid. There is no question, therefore, of the application suffering from delay and latches. 8. Mr. Patil submitted that the application was not maintainable as, on the date on which it was made, the concerned workman was no longer employed by the Respondent. 9. The learned Presiding Officer held that on the date of the present application under Section 33-C(2), there was no workman and employer relationship between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing courts, it calls for a broad and beneficial construction consistently with other provisions of the Act, which should serve to advance the remedy and to suppress the mischief. It may appropriately be pointed out that the mischief which Section 33-C was designed to suppress was the difficulties faced by individual workmen in getting relief in respect of their existing rights without having resort to Section 10 of the Act. To accept the argument of the appellant, it would always be open to an unfair, unsympathetic and unscrupulous employer to terminate the services of his employee in order to deprive him of the benefit conferred by Section 33-C and compel him to have resort to the lengthy procedure by way of reference under Section 10 of the Act thereby defeating the very purpose and object of enacting this provision. This, in our view, quite clearly brings out the repugnancy visualised in the opening part of Section 2 of the Act and such a position could hardly have been contemplated by the Legislature. In order to remove this repugnancy Section 33-C(2) must be so construed as to take within its fold a workman, who was employed during the period in respect of which he claims reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the claim arises in respect of, in relation to or in connection with a period during which he was a workman. It would also lead to an absurd result requiring an employee to file proceedings before the Labour Court for the principal sum and possibly a part of the interest and a civil suit for the interest for the period after he ceased to be a workman. 13. Mr. Patil submitted the application was liable to be dismissed as no evidence had been led by the Petitioner in support of the application under Section 33-C(2). 14. This submission is without any substance. The facts are admitted. There was nothing that was required to be proved. It is based on the above facts alone that the application was made. The Respondent has not and indeed cannot deny the fact of the order dated 30th September, 1992, the orders of this court and the date on which the payment was finally made. 15. The Respondent's contended that the claim was barred by res judicata and/or principles analogous thereto. The claim in the first application under Section 33-C(2) pertained to the Petitioner's deceased husband's wages for the period 1980 to 1987. No interest was claimed in that application. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riate Government and any amount found due by the Labour Court may be recovered in the manner provided for in sub-section (1). (5) Where workmen employed under the same employer are entitled to receive from him any money or any benefit capable of being computed in terms of money, then, subject to such rules as may be made in this behalf, a single application for the recovery of the amount due may be made on behalf of or in respect of any number of such workmen. Explanation. -In this section Labour Court includes any court constituted under any law relating to investigation and settlement of industrial disputes in force in any State.] 17. A decree in a civil suit must be executed under the provisions of Order XXI of the Code of Civil Procedure. In a civil suit if the decree does not provide for interest, the executing court cannot grant interest as the provisions of Order XXI of the CPC do not entitle the executing court to confer any benefit upon the decree-holder, other than that stated in the decree itself. 18. That the Executing Court cannot grant interest in execution of a decree under Order XXI of The Civil Procedure Code, 1908, however, does not bar a separate, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a vs. Hisam Singh and anr., 1999 II LLJ 335 In this case, the services of the Respondents were terminated. In the industrial dispute raised by the Respondent, the Labour Court ordered reinstatement with full back wages and continuity of service. The Petitioner reinstated the Respondents, but paid the back wages only after a period of four years and eleven months. The Respondents, therefore, filed a Petition under Section 33-C(2) of the Industrial Disputes Act for interest during this period. It was contended that the Labour Court had no jurisdiction to award interest on account of the delay in payment of back wages. The Division Bench held thus : The contention is wholly misconceived. In pursuance to the award dated August 27, 1990 the Management should have made the payment of back wages within a reasonable time. It took about seven months to reinstate the workman and thereafter almost five years were spent in paying the back wages. During this long interval the petitioner kept the money which was rightfully due to the respondent. No justification for such an inordinately long delay in payment has been even offered at the hearing of the case. In such a situation, we find th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said that the same is without jurisdiction. That contention must therefore, be rejected. (emphasis supplied) 25. The judgment is binding on me. I am, in any event, in respectful agreement with the judgment for the reasons I have stated earlier insofar as it relates to the maintainability of a claim for future interest. In the case before me also, the interest claimed is not on the amounts unpaid upto the date of the order of the Labour Court dated 30th September, 1992, but in respect of the amounts awarded from a future date. Future interest could always have been granted when the order dated 30th September, 1992, was passed. For the reasons stated earlier, there is nothing that prevented the Petitioner from claiming it by a separate application. The Petitioner was not bound to presume that the Respondent would not honour an order of a competent Court. Indeed the Petitioner, like any other citizen, is justified in assuming that orders would be obeyed. 26. I am in respectful agreement with the conclusion of the Division Bench of the Punjanb Haryana High Court and of the learned single Judge of this Court. I would, however, furnish my reasons for the same. 27. The cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clude a judgment debt; . The claim for interest in this case was not in respect of a judgment debt. 29. I have come to the conclusion that the Petitioner is entitled to interest from 30th December, 1992 itself in view of the provisions of Section 3(1)(a). The order dated 30th September, 1992, falls within the ambit of the expression written instrument in Section 3(1)(a) of the Interest Act. There is neither any warrant nor justification for limiting the scope of this expression. In Savitribai vs. A. Radhakishan AIR 1948 Nagpur 49, a Division Bench held that a decree is an instrument within the meaning of the Interest Act, 1839. Paragraph 5 of the judgment reads as under : 5. The only question which arises here and which did not arise in the other cases relates to the plaintiff's claim for interest. It is relevant to note that interest was decreed in the previous suits which the plaintiff was forced to file. It is said that this operates as res judicata, but we need not proceed on that ground because we agree with 15 Luck. 537, that the Interest Act of 1839 applies. As the learned Judges said there : The claim in the present case is for a certain sum payable at a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an instrument. This is so, both by considering such instruments as being liable to stamp duty as also excluding them from the necessity of being stamped. 32. In the circumstances, the term instrument in Section 3(1)(a) of the Interest Act is wide enough to include a decision by the Labour Court under Section 33-C(2). Accordingly, interest would be payable on the said sum from 30th December, 1992 till payment and/or realisation. There is no dispute regarding the computation. 33. Even assuming that the order dated 30th September, 1992 is not a written instrument and the Petitioner is therefore not entitled to payment of interest under Section 3(1)(a), she would be entitled to the same under Section 3(1)(b). By the order dated 30th September, 1992 the Labour Court upheld the Petitioner's deceased husband's claim and directed the payment thereof within three months i.e. on or before 30th December, 1992. The Respondent failed to do so. By a letter dated 26th February, 1996, the Petitioner's advocate called upon the Respondent to pay the amount pursuant to the order dated 30th September, 1992 with interest at 12 per cent per annum. The Petitioner would, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. The words, in Section 4(1) or other rule of law would include interest payable in equity. In fact, interest has been awarded by our courts in equity as well as on principles analogous to Section 34 of the Code of Civil Procedure on the basis that Section 34 is based upon principles of justice, equity and good conscience. 37. It is important to note that there is no legal provision or any other rule of law that prohibits the grant of interest for the period during which a debtor fails to comply with an order of payment passed by a Court, Tribunal or any other competent authority. This enables, therefore, the application of the common law principles relating to equity. 38. In Hanbury Maudsley Modern Equity, 13th Edition, it is noted at page 33 : As we shall see, it is in the field of remedies that equity displays perhaps the greatest inventiveness and capacity for development, providing relief in new situations as they arise. The foot note to this commentary refers to Anton, Piller and Mareva injunctions. The categories of equitable interest do not appear to be closed despite the on-going debate as to whether new ones ought to be created or not. Commentaries on e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso be awarded on equitable grounds as was held by this Court in Satinder Singh v. Umrao Singh (1961) 3 SCR 676. Referring to the province of the Interest Act of 1839, in relation to the compulsory acquisition of land where no specific provision is made for grant for awarding the interest, the Court held: In this connection we may incidentally refer to Interest Act, 1839 (XXXII of 1839). Section 2 of this Act confers power on the court to allow interest in cases specified therein, but the proviso to the said section makes it clear that interest shall be payable in all cases in which it is now payable by law. In other words, the operative provisions of Section 1 of the said Act do not mean that where interest was otherwise payable by law court's power to award such interest is taken away. The power to award interest on equitable grounds or under any other provisions of law is expressly saved by the proviso to Section 1. This question was considered by the Privy Council in Bengal Nagpur Rly. Co. Ltd. v. Ruttanji Ramji AIR 1938 PC 67. Referring to the proviso to Section 1 of the Act the Privy Council observed `this proviso applies to cases in which the court of equity exercise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deposited by the claimants to be returned with interest at the rate of 12 per cent per annum. This Court enhanced the rate of interest to 15 per cent per annum. To sustain the direction for payment of interest reliance was placed on behalf of the claimants on Section 34 CPC and payment of interest at the rate at which moneys are lent or advanced by national banks in relation to commercial transactions was demanded. This Court did not agree. 44. In South Eastern Coalfields Ltd. vs. State of Madhya Pradesh (2003) 8 SCC 661 in paragraphs 21 and 22 the Supreme Court held thus : 21. Interest is also payable in equity in certain circumstances. The rule in equity is that interest is payable even in the absence of any agreement or custom to that effect though subject, of course, to a contrary agreement (see Chitty on Contracts, 1999 Edn., Vol. II, Para 38-248 at p. 712). Interest in equity has been held to be payable on the market rate even though the deed contains no mention of interest. Applicability of the rule to award interest in equity is attracted on the existence of a state of circumstances being established which justify the exercise of such equitable jurisdiction and such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, distinguishable. 47. In Management of Nathan's Press, Madras vs. K. Krishnan ors., the learned single Judge followed the judgment in Krishnamurthy's case. In this case, an Award was passed directing the Petitioner to reinstate the first Respondent with full back wages with continuity of service etc. The Petitioner reinstated the first Respondent, but did not pay back wages and other benefits. The first Respondent filed a Claim Petition under Section 33-C(2) claiming various amounts as also interest at 6% per annum. Interest was granted on the amounts awarded. It was contended that the Labour Court is not a Civil Court and does not possess the same power as a Civil Court on the question of interest. The first Award itself did not contain any stipulation as to interest. It was the amount under that Award which was sought to be recovered by the further application under Section 33-C(2). The learned Judge held in paragraph 4 as under : 4. .................... The Labour court, while making the computation has got only role of an executing court, and it cannot go beyond the award unless the question is incidental to working the reliefs on the basis of the awar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to recover the same in the manner as an arrear of land revenue. The Division Bench rejected the contention that merely because the Labour Court/Industrial Court had not directed payment of interest and the recovery certificate also did not refer to interest, no interest was payable. The judgment was also based on Section 33C(1) read with Section 267 of the Maharashtra Land Revenue Code. 49. Subsequently, I discovered that an application for review was made in that matter on the ground that the Division Bench had passed its judgment on the provisions of a proposed amendment to Section 267 of the Maharashtra Land Revenue Code. The Ordinance containing the purported amendment had lapsed and the amendment never came into effect. 50. I, therefore, placed the matter for directions and invited the attention of both the learned Counsel to this fact as well as to the judgment of the Division Bench dated 31st March, 2006, dismissing the Review Petition on the ground that the judgment had granted interest, nor merely on the basis of the proposed amendment to Section 267, but also in exercise of the powers of the Division Bench under Article 226 of the Constitution of India. 51. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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