MANAGEMENT OF WENGER & CO. versus THEIR WORKMEN

Citation: [1963] SUPP. 2 S.C.R. 862 · Decided: 11-12-1962 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR

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Judgment (excerpt)

1962 
December, 11. 
862 SUPREME COURT REPORTS [1963] SUPP. 
MANAGEMENT OF WENGER & CO. 
"· 
THEIR WORKMEN 
(And Vice Versa) 
(P. B. GAJENDRAGADKAB, K. N. WANCHOO, 
K. C. DAB GUPTA and J.C. SHAH, JJ.) 
Industrial 
Disput,e-H oteZ. and 
RestauranlB-Whtther 
wine shops are part of the Hotel establiahment-Financial posi-
tion of employer and wage atructure-Bonus-RemuneratiO'll of 
partner.-Bxtent and scope of interference of this Court in 
appeal-Firm whether a legal person-Tips-Whether to be exclu-
ded in the matter of D.A.-Gratuity scheme-Whether justified 
when provident fund scheme available-Miscond11,ct-Involving 
moral turpitude-Retrospective operation of award-Nature of th• 
Tribunal's power-Oonatitution of India, Art. 136-Industrial 
Diaputes Act, 1947 (14 of 1947), s. 19A (4). 
An industrial dispute arising out of the demands made by 
the employees against 13 Hotel and Restaurant institutions in 
Delhi was referred for adjudication to the Industrial Tribunal 
and they were heard together with another reference made to it 
concerning the disputes in the case of two other hotels. The 
award given by the Tribunal in these two references gave rise to 
the present four appeals by special leave, two of which had been 
filed by the employees and the othet> two by the employers. 
The main contentions in the appeals were the following: 
It was contended on behalf of the employers that the Tribunal 
was in error in dealing with the two hotels and eleven restau-
rants together inasmuch as they were not similar in character. 
Their next contention was that the Tribunal committed another 
error in treating the wine shops as part of the restaurant esta-
blishment. Thirdly it was contended that in constructing the 
wage stmcture the Tribunal did not consider properly the 
financial position of the employers. The next contention was 
that the Tribunal erred in reducing the amount of remunera-
tion claimed by the employers for the different partners who 
b'ok active part in the management of their respective estabJish. 
ments. It was further contended on their behalf that since 
each one of the workers gpt Rs 50/-to 60/- by way of tips no 
\ 
2 S.C.R. 
SUPREME COURT REPORTS 
863 
D.A. should have bccu awarded tu the waiters. 
Another con-
tention was that in view of the fact that Employees Provident 
Fund Scheme had already been introrluccd in these establish-
ments the introduction by the award of a gratuity scheme was 
not ju-:tified. It was the case of the employers that even if such 
a schen1c \vas justiU.ed on principle tlte scheme as contained in 
the present award is bad on n1crits. It was further contended 
that the directions of the Tribunal regarding the decisions cf 
the service charges in the future wa<; outside the jurisdiction of 
the Tribunal, because this was not a matter referred to it for 
adjudication. They lastly contended that the Tribunal had no 
power to give retrospective operation to the a'vard. 
The employees contended, among other things, that the 
bonus awarded was inadequate on the 1iround that the calcula-
tion made by the Tribunal in respect of income.tax claimed by 
the enlployees as a prior charge are obviously inconsistent \Vi th 
the decisiuns of this Court i·l recent case of T·ulai Das Khinij-i 
v. Their Worlcmen, [1963] l S.C.R. 675. 
Held, that though the nature of the service rendered in 
Hotels is in some p3.rticulars cl ifferent from that of the Restau-
rants, both the establishments are constituent~ of the f'atering 
trade. Taking into consideration that they are situated in 
similar localities and carry- on the same business it is desirable 
that terms and conditions of service of the employees working in 
them should as far as possible he uniform; such unifonnity i~ 
conducive to industrial peace and harrnony and to better, 
efficient and satisfactory management. 
The question whether there is functional intregrality 
between two units has to be decided according to the facts of 
each case. Absence of functional intcgr ..1.lity and the fact that 
the two units can exist one without the other do not necessarilv 
...._ 
show that where they exist they are necessarily separate unit~ 
and do not constitute one establishment. 
Associated Cement Co. Ltd. v. Their Workmen, (1960) 
l L.L.j.,l, Pratapl'res.•v. Their Workmen, (1960)1 L.L.J. 497, 
Pak<hhaj Studios v. Its Workmen, (1961) II L.L,J. 380, South 
Indian Afillo1oners' .4ssnciation v. OoimlJatore Di8trict Textile 
Wor/:m Union, (1962) 

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