GREAVES COTTON AND COMPANY LIMITED GREAVES COTTON AND CROMPTON PARKINSOII PRIVATE LIMITED KENYON GREAVES PRIVATE LIMITED RUSTON AND HORNS Vs. GREAVES COTTON AND ALLIED COMPANIES EMPLOYEES UNION:GREAVES COTTON AND ALLIED COMPANIES EMPLOYEES UNION

JUDGEMENT

(1.) THE following Judgment of the court wasdelivered by:

(2.) THESE nine appeals by special leave arise out ofthe awards of the Industrial tribunal, Bombay and will bedealt with together. There were disputes between the fourappellants--companies and the respondents, their workmen,which were referred for adjudication to the IndustrialTribunal by nine reference-orders on various dates betweenApril to December 1959. The main dispute which gave rise tothe references was with respect to wages, dearness allowanceand gratuity. The references included other items also butwe are not concerned in the present appeals with thoseitems. Of the four companies who are the appellants beforeus, Greaves Cotton and Co., is the first company and itsmain activity is to invest money in manufacturing concerns.The second company is Greaves Cotton and Crompton ParkinsonPrivate Limited and its main business is distribution of theproducts of a manufacturing concern known as CromptonParkinson (Works) India Limited and service and repair tothe said products at its workshop. The third company isKonyon Greaves Private Limited and its main business is tomanufacture high grade interstranded ropes for the textileindustry. The last company is Ruston and Hornsby (India)Private Limited and its main business is to manufacture oilengines and pumps. The last three companies are controlledby the first company, namely Greaves Cotton and Co., in oneway or the other and that is how the main dispute relatingto wages and dearness allowance was dealt with together bythe tribunal. There were two references each with respectto the first three companies and three references withrespect to Ruston and Hornsby Private Limited; and that ishow there are nine appeals before us. There were nineawards, though the main award dealing with the main disputerelating to wages and dearness allowance was common.

(3.) THE main contention of the appellants however is that thetribunal has gone wrong in applying the industry-cum-regionformula which is the basis for fixing wages and dearness andhas made comparison with concerns which are not comparable.It is also urged that the tribunal has relied more on theregion aspect of the industry-cum-region formula and not onthe industry aspect when dealing with clerical andsubordinate staff and in this it went wrong. Reference inthis connection is made to two decisions of this court,namely, Workmen of Hindusthan Motors v. HindusthanMotors(',) and French Motor Car Company v. THEir Workman (2) and it is emphasis that the principles laid down inHindusthan Motors' case(') were more applicable to thepresent case than the principles laid down in the FrenchMotor Car Co.'s case(2). In the Hindusthan Motors case(1),this court observed that it was ordinarily desirable to haveas much uniformity as possible in the wage-scales ofdifferent concerns of the same industry working in the sameregion, as this puts similar industries more or less on anequal footing in their production struggle. This courttherefore applied the wage-scales awarded by the Third MajorEngineering tribunal in Bengal in the case of HindusthanMotors also. It is urged that the tribunal should havetaken into account comparable concerns in the same industryand provided wage-scales on the same lines so that, so faras manufacturing concerns in the present appeals areconcerned, there will be equality in the matter ofcompetition. In the French Motor Car Co.'s case(2) howeverthis court held so far as clerical staff and subordinatestaff are concerned that it may be possible to take intoaccounteven those concerns which are engaged in different lines ofbusiness for the work of clerical and subordinate staff ismore or less the same in all kinds of concerns. We are ofopinion that there is no inconsistency as urged in theprinciples laid down in these two cases. As we have alreadysaid the basis of fixation of wages and dearness allowanceis industry-cum-region. Where there are a large number ofindustrial concerns of the same kind in the same region itwould be proper to put greater emphasis on the industry partof the industry-cum-region principle as that would put allconcerns on a more or less equal footing in the matter ofproduction costs and therefore in the matter of competitionin the market and this will equally apply to clerical andsubordinate staff whose wages and dearness allowance also gointo calculation of production costs. But where the numberof comparable concerns is small in a particular region andtherefore the competition aspect is not of the sameimportance, the region part of the industry-cum-regionformula assumes greater importance particularly withreference to clerical and subordinate staff and this waswhat was emphasised in the French Motor Car Co.'s case()where that company was already paying the highest wages inthe particular line of business and therefore comparison hadto be made with as similar concerns as possible in differentlines of business for the purpose of fixing wage-scales anddearness allowance. THE principle therefore which emergesfrom these two decisions is that in applying the industry-cum-region formula for fixing wage scales the tribunalshould lay stress on the industry part of the formula ifthere are a large number of concerns in the same regioncarrying on the same industry; in such a case in order thatproduction cost may not be unequal and there may be equalcompetition, wages should generally be fixed on the basis ofthe comparable industries, namely, industries of the samekind. But where the number of industries of the same kindin a particular region is small it is the region part of theindustry-cum-region formula whichassumes importance particularly in the case of clerical andsubordinate staff, for, as pointed out in the French MotorCar Co.'s case,(' there is not much difference in the workof this class of employees in different industries. In thepresent cases it does appear that the tribunal has leanedmore on the region part of the industry-cum-region formulaand less on the industry part. But we think that it cannotbe said that the tribunal was wrong in doing so for tworeasons. In the first place these four companies are notengaged in the same line of industry; but on account ofcertain circumstances, namely, that Greaves Cotton and Co.is the controlling company of the other three, it has beenusual to keep the same scales for clerical and subordinatestaff in all these concerns. In the second place, it is notclear, as was clear in the Hindusthan Motors case(' thatthere are a large number of comparable concerns in the sameregion. As a matter of fact the main company out of thesefour is Greaves Cotton and Co. Limited, which is in the mainan investment and financial company and the tribunal wastherefore right in taking for comparison such companies aswould stand comparison with the main company in the presentappeals (namely, Greaves Cotton and Co).