BIHAR STATE ELECTRICITY BOARD PATNA Vs. THEIR WORKMEN

JUDGEMENT

(1.) This appeal is by special leave granted by the Court against the award of the Industrial Tribunal Bihar at Patna in reference No. 54 of 1966 made by the Government of Bihar on 25th November, 1966. The special leave granted is limited only to the question whether there should be a contributory provident fund scheme on the basis of basic wages or total wages. It was noted at the time of granting the special leave that the appellant Board is willing to extend that scheme to all the workers except the Government servants who are on deputation and those to whom the Employees' Provident Fund Act applies. Therefore the only item in reference No. 54 of 1966 which is relevant for the purpose of this appeal is the following:

(2.) The Employees' Provident Fund Act applies only to establishments which are factories. It could be applied to establishments which are not factories if the Central Government by notification in the Official Gazette specifies in this behalf. The industry in question, electricity - including the generation, transmission and distribution thereof, is one to which the Act applies. But as is well-known only a small proportion of employees connected with the generation of electricity is in establishments which are factories. The transmission and distribution is all over the State and the employees concerned with transmission and distribution and the maintenance of those lines of transmission and distribution are spread all over the State and. probably far outnumber those working in establishments which are factories. To them the Employee's Provident Fund Act does not apply. The Board maintains a Contributory provident Fund where the contribution is on the basis of basic wage, the Board and the employees contributing equally.

(3.) The workmen claimed that all workmen of the Board should have same and similar benefits and that therefore there should be no distinction between the Board's Contributory Provident Fund scheme and the scheme under the Employees Provident Fund Act. Moreover, the- contribution under the Act is 8 per cent whereas under the Board's scheme it is 6 1/4 per cent.. The employee also contended that the services of the workmen of the Board are liable to be transferred from one establishment to another both of which may not be covered by the same scheme under the Act and therefore it will bring about serious injustice if they are deprived of their benefits under the Act, and such anomalies will be removed by making the benefits under both the scheme similar. The Board's contention was that this would impose additional financial liabilities which the Board would not be able to bear. Therefore, the main question which the Tribunal had to consider was the Board's financial capacity to implement the Provident Fund Scheme as demanded by the workmen. It seems to have been argued on behalf of the workmen that the State Government is the financier of the Board which charges interest now at the rate of 6 1/4 per cent as against the previous 4% per annum. It was also contended that no scheme run by the Board was running at a loss. Exhibit 17, purported to contain trading results of the Board, was shown to the Tribunal and it was argued that in the year ending March 1969 Board's gross profits amounted to Rs. 305.12 lakhs and it had been continuously rising from Rs. 59.39 lakhs in 1961. Exhibit 18 shows the loans which have been received from the Government by the Board and the balance sheet shows a very large amount in the shape of interest payable to the Government. It was argued on behalf of the Union that this amount should be taken as dividend to be paid to the Government by the Board and should not be taken into consideration while deciding matters regarding benefits to be made available to its employees. The validity of none of these contentions was considered by the Tribunal. It referred to an award made by it in 1964 in reference No. 19 of 1960 in which it had held that if the interests realised by the State were excluded from consideration there would be surplus in favour of the Board. In that award it had been pointed out that it had not been explained by the management how the depreciation had been calculated. That award also pointed out that one of the main reasons for the deficits shown. was heavy interest on the capital investment, that in an electrical establishment capital investments are heavy in the initial stages, that the Board expected that after the load developed fully the scheme would start giving adequate profits. The Tribunal thought that the position at present was not worse than what it was earlier and that therefore the Board should extend the benefits of the Contributory Provident Fund to all workmen other than those who are covered by the Act. It therefore ordered that the contribution should be 6 1/4 per cent. but not on the basic wages but on the total wages.