FRENCH MOTOR CAR COMPANY LIMITED Vs. THEA WORKMEN

JUDGEMENT

(1.) This appeal by special leave arises out of an industrial dispute between the appellant, M/s. French Motor Car Co. Limited and their workmen, who are the respondents before us. Four matters were referred for adjudication by the Government of Maharashtra under S. 10 of the Industrial Disputes Act, No. XIV of 1947, to the Industrial Tribunal, Maharashtra. Of these we are concerned in the present appeal with (i) wages and scales of pay for clerical staff workshop employees and subordinate staff {ii) dearness allowance for clerical staff, and (iii) provident fund.

(2.) The case of the respondents was that the appellant company was in a very flourishing condition and therefore the wage-scales should be revised. The appellant did not contend that its financial position was not good enough to bear an increased burden; it, however; contended that the wage scales had been revised only few years before and there was no ground for further revision so soon thereafter. The tribunal went into the financial capacity of the appellant to bear an increased burden of wage scales and found that its finances would be able to bear the burden which it was going to put on it by revision of wage scales. It also went into the history of the appellant company to consider whether a case had been made out for further revision of wages. That history shows that for the first time in 1948 there was an agreement between the appellant and its workmen by which scales of wages were fixed. Soon thereafter an award was made by another tribunal in the case of United Motors (India) Limited, which is a concern carrying on similar business as the appellant and much higher wage scales were found to exist in that concern and were confirmed by the award. These higher scales were later adopted by two other similar concerns in Bombay, namely, Dadajee Dhakjee and Metro Motors. Then followed another dispute between the appellant and its workmen in 1953 with respect to wage scales and an award was made by which practically the same wage scales were prescribed as in the other three concerns, with respect to workshop employees and subordinate staff. Then in 1954 there was another agreement between the appellant and its workmen for fixing wage scales for clerical staff. The present dispute started in 1958, and eventually reference was made by the Government of Maharashtra in 1960, and the contention of the appellant was that there was no reason to revise so soon the wage scales, which are expected to be long term arrangement. The tribunal has, however, pointed out that there has been a large increase in the cost of living since 1955 and the cost of living index number for workmen had gone up from 338 in 1955 to 420 in 1960. It had gone to 428 in 1961 when the award was made. In view of this change in economic conditions the tribunal was of the opinion that a case had been made out for a further revision of wage scales, particularly as the dearness allowance was also revised in 1954 by agreement and the effect of that was to reduce the dearness allowance. We see no reason in these circumstances to disagree with the view of the tribunal that a case has been made out for revising the wage structure.

(3.) The main contention on behalf of the appellant is that wages are fixed on industry-cum-region basis and the tribunal went wrong when it took into account for comparison industrial concerns which were entirely dissimilar to the appellant's. It is now well-settled that the principle of industry-cum-region has to be applied by an industrial Court, when it proceeds to consider question like wage structure dearness allowance and similar conditions of service. In applying that principle industrial Courts have to compare wage scales prevailing in similar concerns in the region with which it is dealing and generally speaking similar concerns would be those in the same line of business as the concern with respect to which the dispute is under consideration. Further even in the same line of business it would not be proper to compare (for example) a small struggling concern with a large flourishing concern. In Williamsons (India) Private Ltd. vs. The Workmen, 1962-1 Lab LJ 302 (SC) this Court had to consider this aspect of the matter , where Williamsons Private Limited was compared by the tribunal with Messers. Gilanders Arbuthnot and Company for purposes of wage fixation and it was observed that the extent of the business carried on by the concerns, the capital invested by them, the profits made by them, the nature of the business carried on by them, their standing, the strength of their labour force, the presence or absence and the extent of reserves, the dividends declared by them and the prospects about the future of their business and other relevant factors have to be borne in mind for the purposes of comparison. These observations were made to show how comparison should be made, even in the same line of business and were intended to lay down that a small concern cannot be compared even in the same line of business with a large concern. Thus where there is a large disparity between the two concerns in the same business, it would not be safe to fix the same wage structure as in the large concern without any other consideration. The question whether there is large disparity between two concerns is, however, always a question of fact and it is not necessary for the purposes of comparison that the two concerns must be exactly equal in all respect. All that the tribunal has to see is that the disparity is not so large as to make the comparison unreal. In Novex Dry Cleaners vs. Its Workmen 1962-1 Lab LJ 271 (SC) this Court pointed out that it would not be safe to compare a comparatively small concern with a large concern in the same line of business and impose a wage structure prevailing in the large concern as a rule of thumb without considering the standing, the extent of labour force, the extent of business and the extent of profits made by the two concerns over a number of years.