SONE VALLEY PORTLAND CEMENT CO. versus THE WORKMEN

Citation: [1972] 3 S.C.R. 674 · Decided: 08-03-1972 · Supreme Court of India · Bench: G.K. MITTER, C.A. VAIDYIALINGAM, I.D. DUA · Disposal: Appeal(s) allowed

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Judgment (excerpt)

SONE VALLEY PORTLAND CEMENT CO. 
v. 
THE WORKMEN 
March 8, 1972 
[C. A. VAJDJALJNGAM, I. D. DUA AND G. K. MITTER, JJ.] 
Cement"Control Order 1961-Higher price paid in respect of cm1ent 
produced in excess of specified form-Whether workers entitkd to share 
.in such extra payment. 
B 
Under the Cement Control Order, 1961 passed by the Government of 
India in exercise of powers under s. 18(g) of the Industries (DeveloP-
C 
ment and Regulation) Act of 1951, producers of cement wete obliged to 
sell all the cement produced by them to the State Trading Corporation 
111 the prices laid down in th.e order. Sub&equently in order to provide 
an incentive to the producers to incresse their output it was Jl<Ovided 
:in the order that if a producer's output was in excess of a certain speci-
.fied quantity, then the payment for such excess would be made at a 
higher rate. The workers of the appellant companies asked for a share 
. in the incentive payment on the contention that they had contributed to 
D 
the excess in production. The IndllStrial Tribunal in its award held that 
the companies and th,eir workmen were entitled to share the incentive 
payment on a fifty-fifty bssis. In appeal by special leave, 
HELD: There it nothing in law which prevents a buyer and seller 
;from agreeln1 that whatever the aeller can offer upto a tjirtain quantity 
will 
he paid for 
at 
a particular rate 
and any 
quantity over E 
and 
allove 
that 
figure 
will 
be 
for 
at 
a 
higher 
rate. 
The total amount which the seller would receive can only . be 
-called 
price even if the contract of sale. was so worded as to 
show that the excesa amount was to be treated as an incentive payment. 
Therefore the argument that the workers wore entitled to a share of the 
extra payment de hors the question of any profit could not be accepted. 
Under the Industriol Law as prop<>Ullded by this Court the. worken can 
lay no such claim. [685F, 6860] 
F 
New Maneck Chowk Spg •. & Wvg. Co. Lid. v. Textile Labour Asso-
ciation, [1961] 1 S.C.R. 1, Th. Mill owner&' Association Bombay v. The 
Rashtriya Mill Mar.door Sangh, Bombay, U960] 1 .S.C.R. 101; M/s Tlta-
ghur Paper Mills Co. Ltd. ,-, Its Workmen, [19591 Suppl. 2 S.C.R. 1012; 
Bum & Co. Ltd., v. Their Empfoivees, ;~1960] 3 S.C.R. 423 and National 
Iron and Steel Co. Ltd.' v. Their Workmen, :H963] 3 S.C.R. 660, referred 
• 
G 
Cement Control Order even if it offered some inducement' -. ihe 
producers to step up their production, the ~rms thereof did not entitle 
the Tribunal to treat it as and by way of in~tive bonus. In which· the 
workmen could share. It was certainly up to the producer to intlriiate 
the workmen that under the 1'0rm• of the Control Order an extra amount 
of money would comb to the till of the COIDJl'!DY if production wat In• 
~sed and the producers could have sett.led what incentive '&hould be H 
·olfered to the workmen, but merely because an extra amount of money 
which was as and by way of price would llnd its way into the till df the 
-company because the production target waa exceeded, the workmen did· 
SONE VALLEY CEMENT v. WORKMEN (Mitter, /.) 
675 
A 
not become entitied ipso faclO to lay a claim .to too excess amount and 
the Industrial Tribunal was not entitled to take the view that because 
an increase in· production can only come about with the cooperation of 
the workmen they automatically became entitled to a share thereof. An 
industrial court C'ln only award what the law allows. In the absence of 
legislation on the subject and in the absence of a scheme for incentive 
l'. 
payment introduced by the manag,ment, in the 
particular facts 
and 
B 
circumstances of the case, the claim on the part of the workmen had to be 
negatived. f689D-H] 
CML APPELLATE JURISDICTION : Civil Appeal No. 635 of . 
1967. 
C 
Appeal by special leave from the award dated January 11, 1967 
of the National Industrial Tribunal, Bombay in Referenee (NT)-1 
of 1965. 
S, D. Vimdalal, K. D. Mehta, D. N. Mishra and 0. C. Mathur 
D 
for the appellants. 
E 
G 
JI 
K. L. Hathi, for re8pondent No. 1. 
M. K. Ramamurthi and Vineet Kumar, for respondents Nos. 
2 and 3. 
The Judgment of the Court was delivered by 
Mitter, J.-This is an ap~ by special leave from an award 
of a National Tribunal under an order of reference reading : 
"Whether the demand of the workmen for a share 
in the incentive payment allowed by Government to 
cement producers is justified? If so, what should be 
the baJ1is and the quantum payable 

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