Contempt Petition No. 23 of 2000,Writ Petition No. 1621 of 1999

22nd August, 2000

Petitioner Counsel: Mr. J.V.GURUSAHANI
Respondent Counsel: Mr. E.P.BHARUCHA, Mr. S. K. TALSANIA, Mr. KAMDIN, Mr .K. R. SWAMY, Ms. J. SAIGAL,BHASIN & Co., Mr. C.U.SINGH, BHASIN & CO.

Cases Cited:
Kapildeo Prasad Sah v. State of Bihar, (1999) 7 SCC 56 [Para 7]
R.N.Dev. v. Bhagvabati Pramanik, (2000) 4 SCC 400 [Para 7]
S.Ganpathy v. Air India, (Civil App. Nos. 3134-36 of 1993 dt. 16-6-1993) [Para 11]
Dena Bank v. Kirtikumar T. Patel, (1992) 2 SCC 106 [Para 11]

JUDGMENT

JUDGMENT :- The petitioner was in the employment of Air India, the first Respondent since, 1980. On 16th March, 1990 he was suspended in view of contemplated disciplinary proceedings. The Petitioner as an employee under suspension was entitled to subsistence allowance. Aggrieved by what he considered as the nonpayment of the full amount of subsistence allowance, the Petitioner preferred an application under Section 33-C (2) of the Industrial Disputes Act, 1947 before the Central Government Labour Court No.1. The Application was disposed of by an order dated 10th June, 1999 by which the Petitioner was held to be entitled to the payment of a sum of Rs.2,56,956/- and a direction for the payment of that amount came to be issued against the first Respondent. The first Respondent challenged the order of the Central Government Labour Court in Writ Petition No.1621 of 1999 before this Court. By an order dated 4th February, 2000 passed by the Learned Single Judge, the aforesaid order of the Labour Court came to be modified and the petition was disposed of in the following terms :-

"The Petitioner Air India Limited is directed to compute the subsistence allowance payable to the Respondent employee Jagdish Vishindas Gurusahani for the period of suspension is accordance with the Model Standing Orders (Central) within 10 days from today in the presence of the respondent. After adjusting the amount already paid, the difference arrived at from the said computation shall be paid to the respondent employee within one week from such computation. In case of any delay by petitioner in making the aforesaid amount, they would be liable to pay the dues amount payable to the Respondent with interest at the rate of 15% per annum.

The petitioner Air India Limited is also directed to extend the benefit of the settlement dated 31.12.95 and 5.5.96 as and when benefit of the said settlements is extended to its other employees without discriminating to the petitioner.

The order passed by the Central Government Industrial Tribunal on 10.6.99 stands modified in terms aforestated."

As a result of the order passed by the Learned Single Judge the subsistence allowance that was payable for the period of suspension was to be computed in accordance with the Model Standing Orders (Central). This exercise was to be done in the presence of the Petitioner herein within ten days. Thereafter within one week, the amount which was payable to the petitioner under the said computation was to be paid after adjusting what had already been paid to him. Interest at 15% was liable to be paid in the event of a delay in payment. The benefit of the two settlements dated 31st December, 1995 and 5th May 1996 could be extended to the Petitioner as and when that benefit was given to other employees.

2. On 9th February, 2000, in compliance with the order passed by this Court, the Advocates of the First Respondent requested the Petitioner to attend a meeting which would be convened for the purpose of computing the amount which was due to him. This meeting was admittedly held. Thereafter another meeting came to be held on 16th February, 2000 which was attended, inter alia, by the officials of the Personnel Department and of the Accounts Department of the First Respondent. A recording letter dated 16th February,2000 came to be written to the Petitioner enclosing a photocopy of the chart of the calculations which had been carried out by the officials of the First Respondent. The First Respondent computed the total amount which was due to the Petitioner as and by way of subsistence allowance for the period 1st September, 1990 to 15th March, 1996 as Rs. 1,89,278/-. From this amount, an amount of Rs.27,261/- was deducted on account of Income tax and surcharge. Thus leaving a balance of Rs.1,62,017/- as due and payable to the Petitioner. The letter dated 16th February, 2000 is at Exhibit-G to the Contempt Petition and contains the relevant chart at pages 22,23. The chart sets out the new basic pay and the new dearness allowance, meaning thereby what is payable under the settlements as directed by this Court besides pay and various other allowances which the Petitioner was entitled to receive as part of the subsistence allowance.

3. On 18th February, 2000, the Advocates of the First Respondent forwarded a cheque in the amount of Rs.1,62,017.42 towards the subsistence allowance computed in pursuance of the order of this court. The letter recorded that the amount had been calculated after taking the implementation of the Settlements dated 31st December, 1995 and 5th May, 1996 into consideration. By his letter dated 18th February, 2000, the petitioner accepted the cheque under protest and thereafter by a representation dated 24th February 2000 disputed the computation which had been made by the 1st Respondent.

4. The grievance in the Contempt Petition which has been filed before this court is that the computation of the subsistence allowance has not been made in due compliance of the order passed by the Learned Single Judge of this Court on 4th February, 2000. The Petitioner disputes the correctness of the computation in the sense, that he seeks to challenge certain deductions which have been made on behalf of the First Respondent and the non payment of certain sums which he claims to be due. The deductions and non payment of these sums which have been sought to be challenged before me as the foundation of a plea of contempt are : (i) the deduction on account of Income-tax and Surcharge ; (ii) the nonpayment of increments on the wages ; (iii) the nonpayment of the productivity allowance; and (iv) the nonpayment of the subsistence allowance for the period when the Petitioner was in judicial custody during February to August, 1990.

5. At the outset, in considering the merits of this Contempt petition, it will be necessary to advert to the Model Standing Orders which have been framed under the Industrial Employment (Standing Orders) Act. 1946. Model Standing Order 10A in so far as it is material for the present petition provides as follows :-

"10A. Payment of subsistence allowance:(1) where any workman is suspended by the employer pending investigation or inquiry into complaints or charges of misconduct against him, the employer shall pay to such workman subsistence allowance-

(a) at the rate of fifty per cent of the wages which the workman was entitled to immediately preceding the date of such suspension, for the first ninety days of suspension: and

(b) at the rate of seventy five per cent of such wages for the remaining period of suspension if the delay in the completion of disciplinary proceedings against such workman is not directly attributable to the conduct of such workman.

(2) If any dispute arises regarding the subsistence allowance payable to a workman under sub-section (1) the workman or the employer concerned may refer the dispute to the Labour Court, constituted under the Industrial Disputes Act, 1947 (14 of 1947), within the local limits of whose jurisdiction the industrial establishment wherein such workman is employed is situate and the Labour Court to which the dispute is so referred shall, after giving the parties an opportunity of being heard, decide the dispute and such decision shall be final and binding on the parties".

6. Thus from the provisions of Model Standing Order 10A, it is clear that during the period of suspension, the subsistence allowance payable to the suspended employee is liable to be calculated at the rate of fifty per cent of the wages which the workman was entitled to immediately preceding the date of such suspension, for the first ninety days, of suspension. Thereafter, the rate of subsistence allowance is enhanced to seventy-five per cent of such wages for the remaining period of suspension. Clause (2) of the said Standing Order provides a remedy in the event of a dispute arising regarding the subsistence allowance payable. Either the workman or the employer may refer the dispute to the Labour Court which then is vested with the judicial authority to decide the dispute.

7. The provisions of Model Standing Order 10A, particularly Clause (2) thereof are of significance because a clear remedy is provided to the employer as well as to the employee in the event of a dispute arising as regards the computation of the subsistence allowance. Now, it is well settled that when a Contempt Petition comes up for hearing before the High Court the existence of an alternative remedy does not necessarily or ipso facto bar access to the person who claims a breach of the order of the High court. But the existence of a remedy provided by the Statute itself is indeed a relevant circumstance in deciding as to whether the High Court should exercise the power to punish for contempt. The power of the High Court to punish for contempt is intended to protect the majesty of the law and the dignity of the Court. The power is intended to take within its purview wilful or deliberate acts which constitute a defiance or breach of a judgment or order of the Court. The existence of an alternative remedy to seek redressal would be relevant in cases such as the present where a computation that has been made, the entitlement of an employee to an allowance or the validity of a deduction made by the employer is called into question. In such a case, unless the Court comes to the conclusion that there is a clear deliberate or wilful breach of the order passed by the Court or an attempt to evade compliance by resorting to subterfuge, the Court would be inclined to relegate the party to pursue its alternate remedy. This view is supported by recent judgment of the Supreme Court and of this court where, the existence of an alternative remedy has been held to be a sound reason enough not to entertain contempt proceedings. In a similar line of cases the Supreme Court has held that the power to punish for contempt cannot be used as a substitute for the execution of a decree or order of the court. A brief reference to these decisions may be in order. In Kapildeo Prasad Sah V. State of Bihar reported in (1999) 7 Supreme Court Cases 56 the position was summed up in the following words in a Judgment of the Supreme Court delivered by Mr. Justice D.P.Wadhwa.

"For holding the respondents to have committed contempt, civil contempt at that, it has to be shown that there has been wilful disobedience of the judgment or order of the Court. Power to punish for contempt is to be resorted to when there is clear violation of the Court's order. Since notice of contempt and punishment for contempt is of far-reaching consequence, these powers should be invoked only when a clear case of wilful disobedience of the Court's order has been made out...........

Initiation of contempt proceedings is not a substitute for execution proceedings though at times that purpose may also be achieved.

......Wilful would exclude casual, accidental, bonafide or unintentional acts or genuine inability to comply with the terms of the order. A petitioner who complains breach of the court's order must allege deliberate or contumacious disobedience of the court's order."

In a more recent judgment in R.N.Dev vs. Bhagvabati Pramanik reported in (2000) 4 Supreme Court Cases 400, Mr. Justice M.B.Shah delivering the judgment of the Supreme Court held that the power of contempt should be used sparingly and not for the execution of the decree or for the implementation of an order when an alternative remedy in law is provided for. The principle was placed thus in para 7 in the judgment:-

"The weapon of contempt is not to be used in abundance or misused. Normally, it cannot be used for execution of the decree or implementation of an order for which alternative remedy in law is provided for. Discretion given to the court is to be exercised for maintenance of the court's dignity and majesty of law. Further, an aggrieved party has no right to insist that the court should exercise such jurisdiction as contempt is between a contemner and the court..........."

8. A Learned Single Judge of this court (D.K.Deshmukh, J.) in a matter arising under the Maharashtra Employees of Private Schools (Conditions of Service) Regulation Act,1977 also took the view that when there was a sufficient remedy available for the purpose of moving the School Tribunal a contempt petition would ordinarily not lie. In para 6 of his judgment, the learned Single Judge has held as follows :

"...........In a case where effective remedy is provided by the statute for enforcing the order and the petitioner does not avail of that remedy and rushes to the High Court, the High Court would certainly be justified without there being anything else than mere disobedience of the order in declining to entertain the contempt petition. It is thus clear that the existence of remedy for enforcing the order made by the subordinate court as also the question whether the petitioner has availed of that remedy is a relevant consideration. It therefore becomes necessary for me to find out whether the order made by the School Tribunal is capable of being enforced by any other mode."

9. In view of the position in law, this contempt petition would not be maintainable in view of the fact that the Petitioner has a clear remedy available under Clause(2) of Model Standing Order 10A. Clause 2 of the said Standing Order empowers the workman or the employer to refer a dispute to the Labour Court where a dispute arises "regarding the subsistence allowance payable". That in substance is the nature of the dispute which is sought to be raised by the Petitioner.The Petitioner has an alternative remedy. The resort to the power to punish for contempt is inapposite.

10. The Petitioner who argued the matter in person before this court was permitted to submit his grievance at quite some length. The Respondents were heard in reply. Since I have held that the petitioner does have a sufficient alternative remedy to agitate his grievance about the validity of the decision of the First Respondent in regard to the computation of the subsistence allowance, it would not be appropriate for this Court to determine the merits of those grievances. However, the nature of those grievances is being adverted to, together with the nature of the reasons furnished by the First Respondent, for the limited purpose of considering whether there was, in fact, a wilful or deliberate breach of the order dated 4th February, 2000 passed by this court. The submissions of the Petitioner may now be briefly dealt with.

(i) The first ground on which the Petitioner challenged the action of the First Respondent was in regard to the deduction which was made on account of income-tax and surcharge. As stated earlier the total amount which has been deducted under this head is Rs.27,261/-. In this regard, the Petitioner adverted to a communication of the Deputy Industrial Relations Manager of the First Respondent to the Assistant Accounts Officer dated 22nd October, 1991 in which it has been stated that while paying the subsistence allowance, no recoveries including statutory deductions should be made as this would be contrary to law. A view has been taken therein that subsistence allowance is not a salary within the meaning of the Payment of Wages Act and that the Supreme court has held that "if any deduction is made from the subsistence allowance, it will be in violation of the principles of natural justice." Reference has also been made in the submissions to an internal communication dated 14th January 1992 by the Accounts Officer in the Finance and Accounts Department of the First Respondent to a similar effect. On the other hand, the learned counsel appearing on behalf of the First Respondent submitted that the subsistence allowance falls within the definition of expression "salary" within the meaning of the said expression in Section 17 of the Income Tax Act, 1961.

11. Sub-section (1) of Section 17 of the Income Tax Act defines "salary" in an inclusive sense to include inter alia "profits in lieu of or in addition to any salary or wages". The expression "profits in lieu of salary" is again defined in an inclusive sense by sub section (3) of Section 17 to include any payment due to or received by an assessee from an employer or a former employer. Payments referred to in clauses 10, 10A, 10B, 11, 12, 13 and 13A of Section 10 are excluded but, upon perusing those clauses, it is clear that they have no application to the present case. In my view, having regard to the definition of the expression "salary" in Section 17(1) read with the definition of profits in lieu of salary in Section 17(3)(ii), the conduct of the First Respondent cannot be faulted. Once the subsistence allowance falls within the definition of the expression "salary" for the purpose of the Income Tax Act, 1961, the First Respondent as the employer was under an obligation under sections 190 and 192 of the Act to make a deduction at source. A failure to do so would be liable to attract the penal provision contained in Section 200 and 201 read with 204 of the Income Tax Act, 1961. In this connection, reference may be made to the judgment of the Supreme Court in S.Ganpathy Vs. Air India (Civil Appeal Nos. 3134-36 of 1993 decided on 16-6-1993) in which it was held that in computation payments to be made for the purposes of section 33(2)(b) of the Industrial Disputes Act, 1947, a statutory deduction on account of tax could validly be made for the purpose of the computing the amount payable. In this view, therefore, there is no substance in the challenge of the Petitioner.

(ii) The second grievance of the Petitioner is in regard to the nonpayment of the increments during the period of suspension. Here again, Model Standing Order 10A which has been extracted earlier requires the employer to pay a certain percentage of the wages which the workman was entitled to immediately preceding the date of such suspension. The expression "wages" is defined by Section 2(1) of the Industrial Employment (Standing Orders) Act, 1946 to have the meaning ascribed to that expression in Section 2(rr) of the Industrial Disputes Act, 1947 and Section 2 (s) thereof. Under Section 2(rr) "wages" means all remuneration capable of being expressed in terms of money, which would, if the terms of employment express or implied, were fulfilled, be payable to a workman in respect of his employment, or of work done in such employment, and includes all allowances as the workman is for the time being entitled to. On behalf of the Respondents, it was urged that the suspension allowance is liable to be paid under the Model Standing order 10A on the basis of the Wages drawn immediately preceeding the date of such suspension. Therefore, there is no requirement of paying increments. This submission finds support in a Judgment of the Supreme Court in Dena Bank Vs. Kirtikumar T. Patel reported in (1992) 2 Supreme Court Cases 106. The Supreme Court considered the provisions of section 17-B of the Industrial Disputes Act, 1947 under which the employer is liable to pay to the workman during the pendency of the proceedings in the High Court or the Supreme Court in a case where the Industrial Tribunal has directed reinstatement (with) "full wages last drawn by him". Interpreting that expression, the Supreme Court held that the words, "full wages last drawn" would not include yearly increment. In paras 19 and 20 of its judgment, the Supreme Court held as follows :

"As per the decisions of the High Courts referred to above, the expression "full wages last drawn" in section 17-B can mean as under :

(i) Wages only at the rate last drawn and not at the same rate at which the wages are being paid to the workman who are actually working.

(ii) Wages drawn on the date of termination of the services plus the yearly increment and the dearness allowance to be worked out till the date of the award.

(iii) Full wage which the workman was entitled to draw in pursuance of the award and the implementation of which is suspended during the pendency of the proceedings.

The first construction gives to the words "full wages last drawn" their plain and material meaning. The second as well as the third constructions read something more than their plain and material meaning in those words. In substance these constructions read the words "full wages last drawn". Such an extended meaning to the words "full wages last drawn" does not find support in the language of section 17-B. Nor can this extended meaning be based on the object underlying the enactment of Section 17-B."

Here again, having regard to the defence of the First Respondent and the judgment of the Supreme Court, it cannot be said that there is any breach of the order of the Learned Single Judge or a wilful or deliberate breach in any case.

(iii) The third grievance of the Petitioner was that he was not paid the amount of the productivity allowance. In this regard in the affidavit in reply which has been filed on behalf of the First Respondent, it has been stated that by two settlements dated 21st August, 1993 and 12th September, 1994, the additional productivity allowance came to be effective from 1st September, 1993. These settlements came much after the suspension of the petitioner in February 1990. Besides, the settlement specified that the productivity allowance will not be counted as pay for any purpose and that allowance will be paid only to employees who fulfill the productivity points mentioned in the Settlement. Since the petitioner has not worked at all there is no question of his being entitled to the productivity allowance. In my view, the nonpayment of the productivity allowance, having regard to defence of the First Respondent cannot be regarded as a matter where the contempt jurisdiction of this Court is liable to be invoked. The First Respondent has bonafide placed an interpretation on the Settlement which are in force and the defence that an employee who has not actually worked would not be allowed the benefit of the productivity allowance, cannot be regarded either as sham or device to evade compliance with the order of this Court.

(iv) The Petitioner has also submitted that he has not been paid the subsistence allowance during the period from February to August 1990 when he was in judicial custody. In defence to this contention, it has been stated in the affidavit-in-reply filed by Shri. V.A. Ferreira, the General Manager, Industrial Relations Section. HRD of the 1st Respondent that the Petitioner was detained by the Police/customs during the period February 1990 to September 1990 and was in detention under the said authorities. It is sought to be contended that even the Labour Court in its Award dated 10th June, 1999 had come to the conclusion that the Petitioner was not entitled to receive the subsistence allowance during the said period. The conclusion of the Labour Court in this regard is as follows :-

"When the Standing Order does not say anything with regard to the entitlement of detention, it goes without saying that there is no pre-existing right for the employee who was under detention and who is under suspension. In the absence of any pre-existing right by way of award or settlement, the claim made by the applicant for Subsistence Allowance during the period of his detention cannot be considered and the applicant is not entitled for Subsistence Allowance during the period of his detention."

The Labour Court thus held that the claim of the Petitioner for the payment of subsistence allowance during the period of detention in judicial custody could not be determined in the summary proceedings under Section 33(2) of the Industrial Disputes Act, 1947. In so far as this issue is concerned, the Learned Counsel appearing on behalf of the First Respondent sought to lay emphasis, besides the order of the Labour Court upon regulation 43A(d) of the Air India Employees Service Regulations which provides that "if an employee is arrested by the police on a criminal charge and bail is not granted, no subsistence allowance shall be payable. On the grant of bail, if the competent authority decides to continue the suspension, the employee shall be entitled to subsistence allowance from the date he is granted bail". In this regard, I am of the view that the conduct of the First Respondent and its officers in taking a particular view on the basis of the service regulations of Air India cannot be regarded as lacking in bonafides or as amounting to a wilful or deliberate breach of the order passed by this court. It must be clarified that the view which had been taken by the first Respondent may or may not have ultimately been affirmed on the merits, should the Labour Court be required to go into the question under clause (2) of the Model Standing Order 100. This is a matter which will require an authoritative determination by the Labour Court which is the judicial forum specifically vested with the power to decide the question.It will be sufficient to hold that I am not expressing any opinion on the merits of the case. However, this is again an area where the invocation of the contempt jurisdiction of this court is wholly inappropriate.

11. During the course of the hearing of the Contempt Petition, the Petitioner made it clear that he was not interested in the payment of additional amount of money to him as and by way of subsistence allowance. He stated that he was concerned with only the breach of the order passed by this Court, by Air India and its officials and the purpose of these proceedings were to bring them to book. The Learned Counsel appearing on behalf of the First Respondent submitted that the prosecution of these contempt proceedings by the Petitioner is completely lacking in bonafides and adverted to the criminal proceedings which had been adopted by the Petitioner against the First Respondent and its officers. Copies of an order dated 1st July, 1997 passed by the Judicial Magistrate First Class, Thane, dismissing the complaint filed by the Petitioner against the officials of the First Respondent under Section 203 of the Code of Criminal Procedure, the judgment of the Addl, Sessions Judge, Thane dated 9th April, 1998 affirming the order of the learned Judicial Magistrate First Class, an order of this court dated 22nd July 1999 in Criminal Writ Petition No. 815 of 1998 affirming the decisions of the two courts referred to earlier and an order dated 10th February, 1999 passed by the National Industrial Tribunal, Mumbai dismissing a complaint filed by the petitioner against the Respondent herein have been annexed to the affidavit in reply filed on behalf of the first Respondent. A serious grievance has been made of the manner in which the pendency of the present proceedings and the orders passed by this court have been reported in the Press. It is not necessary for this court to delve into that issue at any length. Since in the view which I have taken, it is clear that the Respondents have not committed any breach of the order passed by this Court and in any event no wilful or deliberate breach so as to warrant the invocation of the jurisdiction of this Court to punish for contempt.

Though I have come to the conclusion that no case of contempt or a breach of the order of this Court has been made out, the Learned Counsel appearing on behalf of the First Respondent, in response to a suggestion of the Court has stated that without prejudice to its contentions particularly in other similar cases, the First Respondent shall within a period of four weeks from today pay to the petitioner the subsistence allowance for the period between February, 1990 until August 1990 during which period the Petitioner was in judicial custody. The payment of the subsistence allowance as aforesaid shall be subject to the same order on the basis of which the earlier payment of subsistence allowance was made.

In the result, the Contempt Petition is rejected. The contempt Proceedings are discharged.

Certified copy expedited.

An ordinary copy of this order authenticated by the personal Secretary may be made available to the parties.

Petition rejected.