PURSHOTAM H. JADYE AND OTHERS versus V. B. POTDAR

Citation: [1966] 2 S.C.R. 353 · Decided: 26-10-1965 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR · Disposal: Appeal(s) allowed

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Judgment (excerpt)

• 
-
, 
A 
PURSHOTA.M H. JADYE AND OTHERS 
v. 
V. B. POTDAR 
October 26, 1965 
B 
[P. B. GAJENDRAGADKAR, C.J., K. N. WANCHOO, M. HIDAYA-
c 
D 
E 
F 
H 
TULLAH AND V. RAMASWAMI, JJ.] 
Payment of Wages Act (4 of 1936), s. 2(vi) (d)-Wages-lf inc/dues 
gratuity payable under a1,varid-'lnstru1nent' 111eaning ·of. 
The 2nd respondent was the printer and publisher of a newspaper 
and was the employer of the appellants. 
The Industrial Tribunal had made 
an award framing a scheme of gratuity payable by the' 2nd respondent 
to the appellants on terms and conditions prescribed ·in the award. 
After 
the newspaper ceased publication, the appellants applied to the 1st respon-
dent, the Authority appointed under the payment of Wages 
Act, 1936, 
for payment of the gratuity due to them. The 2nd respondent raised a 
preliminary objection that the. amounts claimed were not wages within 
the meaning of s. 2(vi) (d) of the Act and that therefore the applications. 
were incompetent. 
The !st respondent rejected the contention, but the 
High Court, in an application under Arts. 226 and 227 of the Comtitu-
tion upheld it. 
In th·o appeal to this Court, the ~ucstion was : Did the claim made 
by the. appellants for payment of gratuity due to them under the award 
fall within s. 2(vi) (d) of the Act? 
HELD : Section 2(vi) (d) which provides for the exclusion of certain 
ca!egories of gratuity from the definition of "'vages" necessarily assumes 
that the categories of gratuity other than those specilied by it would fall 
under s. 2(vi) (d). Section 2(vi)(d) refers to any sum which by reason of 
the termination of employment is payable to the employee. 
Since 
the 
expression "by reason of the termination of employment" must mean in 
the context "payable· on the termination of employment," gratuity, \Vhich 
may be payable: to an employee by reason of the termination of his e111· 
ployment, would fall under sub.cl. (d) provided it is shown that it is 
payab]e under any !aw, contract or instrument. 
Thougl1 it could not be 
said that the gratuity in the present case was payable: under any lav./, and 
it could not be held tbat the a\vard vvhich framed a :':.che1ne for pay1nent 
of gratuity would amount to a contrac~ .. the scheme of the d.efinition o.f 
"wages", and the corrtext of sub-cl. (d) suggest that tho word "mstrument' 
would include awards made by Industrial 'Courts of competent jurisdiction. 
[357 D-E. G-B, G·H; 358 E] 
The scope of the denotation of the word "instrument" has to be judged 
in the light of the general object which the definition of "wages" is in-
tended to achieve. 
Ordina.rily, the W.Jrd "instrument" v.rould refer 
to 
documents executed by the parties. 
But if the context clearly indicates 
that the1 \Vord "instrument" ·fts used in a much larger sense, that context 
must be taken into account and a con1prehcnsive i-nterpretalion must be 
placed upon the word. 
When the legislature amended the definition of 
"wages" by Act 68 'of 1957 it obviously intended ro widen the. scope of 
that expression. 
Remunerations and bonus payable under a\vnrds have 
·been included within the definition. 
Thc;·efore, having regard to ohe obj·"ct 
which the legislature had in mind in widening the scope of the definition, 
it would not be unreasonable to hold that the, word "instrument" has a 
\vidcr denotation 1n the ·Context an<l cannot be confined only to docutnents 
354 
SUPREME 
COURT REPORTS 
[1966] 2 S.C.R. 
executed as between the partie9. 
Besides, 
if 
the intention 
of the 
A 
legislature \Va& to confine the word "instrument" to such documents alone, 
·it would have said "under any law, contract or other instrument". [358 
G-H; 359 B-C, F-GJ 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 464 of 
1963. 
Appeal from the judgmerrt and order dated June 14, 1961 
B 
of the Bombay High Court in Special Civil Application No. 1285 
of 1960. 
S. B. Naik, Rajendra Chaudhury and K. R. Chaudhury, for 
the appellants Nos. 1, 2, 4-7, 9-13, 15-17 and 19-34. 
S. V. Gupte, Solicitor-General, B. K. Agarwa/a, H. K. Puri 
for respondent No. 2. 
The Judgment of the Court was delivered by 
Gajendragadkar, C.J. 
The short question of law which arises 
in this appeal is whether workmen are entitled to apply to the 
Authority appointed under the Payment of Wages Act, 1936 (No. 
4 of 1936) (hereinafter calied 'the Act') for the recovery of the 
amount of gratuity due to them under an award passed between 
them and their employer. 
This question has bee

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