MD. QASIM LARRY, FACTORY MANAGER, SASA MUSA SUGAR WORKS versus MUHAMMAD SAMSUDDIN AND ANOTHER

Citation: [1964] 7 S.C.R. 419 · Decided: 24-03-1964 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR · Disposal: Dismissed

Cited by 2 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

• 
7S.C.R. 
SUPREME COURT REPORTS 
419 
MD. QASIM LARRY, FACTORY MANAGER, SASA-
MUSA SUGAR WORKS 
v. 
MUHAMMAD SAMSUDDIN AND ANOTHER 
[P. B. GAJENDRAGADKAR, C.J., K.N. WANCHOO AND K.C. DAS 
GUPTA, JJ]. 
Wages-Industrial Dispute-Wages fixed by the Award-If 
wages as defined by the Act-Payment of Wages Act, 1936 (IV 
Of 1936), SS. 2(vi), 15. 
In pursuance of an award made by an Industrial Tribunal 
fixing the pay of the employees at Rs. 2/2/- per day, the manage-
ment of the appellant had entered into an agreement with its 
workmen, that the effect would be given to the wage structure 
prescribed by the said award. In spite of the award and the 
agreement, the appellant paid its employees only As. -/10/- per 
day and that led to the present claim made by the respondents 
under s. 15 of the Payment of Wages Act. They asked for an 
order from the payment of wages authority directing the appel-
lant to pay the said prescribed wages. Against the respondent's 
claim it was urged by the appellant that s. 15 of the Act was 
inapplicable, because the rates of wages fixed by the award did 
not fall within the definition of wages prescribed by s. 2(vi) of 
the Act. The authority rejected the appellant's contention. The 
appellant then challenged the correctness of the conclusion of 
the authority before the High Court under Art. 226 of the 
Constitution. The High Court dismissed the writ petition and 
affirmed the finding of the authority. It held that s. 15 was appli-
cable to the case, because the wages prescribed by the award 
did amount to wages as defined by s. 2(vi) of the Act. On appeal 
by Special Leave the appellant contended that before it is held 
that the wages prescribed by the award fall under s. 2(vi), it 
must be shown that they constitute part of the terms of the 
contract of employment, either express of implied. 
Held: The argument is not well-founded. When an award 
is made and it prescribes a new wage structure, in law the old 
contractual wage structure becomes inoperative and its place 
is taken by the wage structure prescribed by the award. 
In a sense, the latter wage structure must be deemed to be the 
contract between the parties, because that, in substance, is the 
effect of industrial adjudication. The true legal position is that 
when industrial disputes are decided by industrial adjudication 
and awards are made. the said awards supplant contractual 
terms in respect of matters covered by them and are substituted 
by them. That being so, it is difficuit to hold that the wages 
prescribed by the award cannot be treated as wages under 
s. 2(vi) of the Act before it was amended. The amendment has 
merely clarified what was included in the unamended definition 
itself. 
South Indian Bank Ltd. v. A. R. Chacko, A.LR. 1964 S.C. 1522, 
referred to. 
Jogindra Nath Chatter.iee and Sons, v. Chandreswar Singh, 
A.LR., 1951 Cal. 29, inapplicable. 
Modern M~lls Ltd. v. V. R. M:anga!vedhikar, A.LR., 1950 
Born. 342 and V. B. Godse, Manager, Prabha Mills Ltd. v. R. M. 
N airk [1953] 1 L.L.J. 577, approved. 
L/P{D)JSCI-14(a) 
1964 
March 24 
1964 
Md. Qa.oim La"y, 
Fadmy Manager, 
Saaamuaa 
Sugar Work< 
v. 
Muhammad 
Samauddin and 
An<>IMr 
.w~;: 
420 
SUPREME COURT REPORTS 
[1964] 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 251 of 
1963. Appeal by special leave from the judgment and order 
dated March 20, 1957, of the Patna High Court in Civil Revi-
sion No. 40 of 1956. 
M. C. Setalvad, and R. C. Prasad, for the appellants. 
The respondent did not appear. 
March 24, 1964. The Judgment of the Court was deli-
vered by 
GAJENDRAGADKAR, C. J.-The short question which arises 
Gaj<nlragadm, c.J.ifi this appeal is whether the term "wages" as defined by sec-
tion 2(vi) of the Paymf'nt of Wages Act, 1936 (No. 4 of 1936) 
(hereinafter· called 'the Act') includes wages fixed by an award 
in an industrial dispute between the employer and his em-
ployees. This question has to be answered in the light of the 
definition prescribed bys. 2(vi) before it was amended in 1958. 
The subsequent amendment expressly provides by s. 2(vi) (a) 
that any remuneration payable under any award or settlement 
between the parties or order of a Court, would be included 
in the main definition under s. 2(vi). The point which we have 
to decide in the present appeal is whether the remuneration 
payable under an award was not already included in the defi-
nition of wages before the said definition was amended. 
It is common ground that between t

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