1. Sri Vinod Upadhyay, Senior Advocate, assisted by Sri Ritvik Updhyay for the petitioner and learned Standing Counsel for respondent no.1 and 3. Initially, Sri P.C. Jhingam had put in appearance and filed counter affidavit and after his death notice was issued to respondent no.2 to engage another counsel vide order dated 21.10.2011. None has appeared on behalf of respondent no.2 though the case has been called in revised list.
2. The writ petition is directed against the award dated 29th April 1991 of Industrial Tribunal-I, U.P. at Allahabad (hereinafter referred to as "the Tribunal") in Adjudication Case No. 40 of 1989 whereby the Tribunal has directed the petitioner i.e., M/S Hindalco Industries Ltd. (hereinafter referred to as "the employer") to pay 10% of the basic pay towards house allowance to workers who are not provided housing accommodation by the employer, from the date of their appointment till such time housing accommodation is not offered to them.
3. Respondent no.2 is a union of workers of Hindustan Aluminium Corporation Limited, Renukoot, in district Sonbhadra. An industrial dispute was raised by the Union that some of the workers who are not provided with housing accommodation should be provided house rent allowance. A reference was made for adjudication of the above dispute vide State Government notification dated 1.5.1989 under Section 4-K of U.P. Industrial Disputes Act to the following effect:
"Kya Sewayojkon dwara apne kuchh shrmikon ko avas suvidha athva avas bharra na diya jana uchit tatha/athva baidhanik hai? Yadi nahin, to sambandhit shramika kya laabh/kshatpurti paane ke adhikari hai, kis tithi se tatha anya kis vivaran sahit?"
5. The area in which the petitioner's industrial establishment is established was basically a forest area in which about more than 50 years ago, on the initiative taken by State Government and the management of the petitioner's industrial establishment, a heavy industry was set up with multiple objectives of contributing to the national resources and also providing development and employment to local inhabitants. The adjacent area was mostly inhabited by Adivasis and other very poor rural inhabitants. It is the establishment of the large industrial undertaking HINDALCO which increased employment potential in the area attracting a huge labour force from the adjacent area as also the distant ones. The basic requirement i.e. establishment of industry obviously is to be catered first and therefore, land became available to the petitioner was mostly used for establishing industrial undertakings. Besides thereto, some residential accommodation had also been constructed including schools, playgrounds etc. Some residential accommodation has been constructed for the benefit of State's administrative departments which is again for the larger benefit of the industrial working force in petitioner's industry, which at the time of dispute in question was about 15000/-.
6. Outside industrial establishment, private residential accommodation was scanty and virtually people find it very difficult to get a suitable accommodation in and around 70 KM area in which the industry is situated. Since the accommodation available with the industry is limited, the management followed principle of seniority for allocating residential accommodation to labourers. Such accommodation is provided free of cost subject to charge of nominal amount towards maintenance.
7. The case of the workmen is that since the housing accommodation having been provided free of cost to some of the workers while others did not get it, they are entitled for suitable house rent allowance otherwise treatment of the industry would be arbitrary and discriminatory. The workers initially claimed housing rent allowance (for short 'HRA') at the rate of 20%.
8. Sri Upadhyay contended that there is no express or implied condition of service obliging the employer to provide residential accommodation or HRA to the entire industrial force. Facility of housing accommodation provided by the employer was voluntary. The industry though inclined to allot housing accommodation to all its employees so that the workers may serve the industry with much efficiency but it has its own limitations inasmuch as the land is not available. The industry is corresponding and approaching the State Government for acquisition of more land but has not been successful therein so far. In any case, the voluntary act on the part of employer cannot be treated to be an express or implied conditions of service to provide free accommodation to labourers or payment of HRA. The Tribunal having failed to consider relevant aspects had erred in law and therefore, the impugned award is liable to be set-aside. Reliance is placed on Apex Court's decisions in B.N. Elias and Co. Ltd. Employees' Union and others Vs. B.N. Elias and Co. Ltd. and others AIR 1960 SC 886, Patna Electric Supply Company Limited, Patna Vs. Patna Electric Supply Workers' Union AIR 1959 SC 1035.
9. Sri Vinod Upadhyay, learned Senior Advocate further contended that the basic obligation of providing housing facility to the public at large is that of the Government and not of the petitioner Industry. There is no agreement between the petitioner and respondent no.2 i.e., the employer and employees that either housing accommodation or allowance in lieu thereof shall be provided. There is no service condition to this effect. No assurance ever held by the petitioner industry to the workmen that after their engagement/employment in service with the petitioner industry, they would be provided housing accommodation or allowance in lieu thereof. He contended that in view of absence of any service condition, the award of the Tribunal is wholly illegal, unjust, unreasonable and, therefore, liable to be set aside.
10. Learned Standing Counsel on the contrary attempted to support the award for the reasons stated therein
11. I have heard learned counsel present for respective parties and perused the record.
12. The award of Labour Court itself shows that the place it is now known as Renukoot was previously a village named Jhokhai. There was only Adivasi population in this village used to live in hutments. The petitioner industry was established in 1960 and production commenced in 1962. The land was acquired by the State Government for establishment of the above industry and the petitioner industry undertaking, besides set up of their factory/plant also set up a power generation unit and also built residential colonies, schools, playgrounds etc. for their employees.
13. Admittedly, there is no written service condition agreement, contract or anything alike which may entitle the workmen either to get free housing accommodation or HRA from the petitioner industry. Considering the peculiar facts and nature of industrial unit in its own interest, the industry has constructed a number of residential houses and allotted to its workmen/employees who are permanent. Allotment is founded on the criteria of seniority since number of accommodation is lesser than the number of workers claiming it. At the relevant time, the industry was charging Rs.6/- per month towards maintenance charges. The employer's stand that there is no condition of service obliging it to provide free residential accommodation or HRA in lieu thereof, was not found incorrect by the Tribunal. There is no such representation also by the employer. This is evident from the following findings:
"It is also true that the basic duty to provide industrial housing is that of the Government and not of the employers. It is also true that there is no agreement between the workers and the employers according to which house accommodation is to be provided to workers. There is no service condition to that effect. No assurance is given to the workmen when they enter into service that they will be provided with house or else house rent."
14. However, having said so the Tribunal then proceeded to observe that since some of the workmen have been provided housing accommodation voluntarily, non-providing of housing accommodation or HRA in lieu thereof to others would be arbitrary. If the employer on its own has provided housing accommodation, free of cost to some of the workers i.e., about 50% , it amounts to an implied service condition though there is no any express condition in any agreement to this effect. The Tribunal has further applauded the welfare measures taken by the employer of suo motu extending facility of free housing accommodation to its employees despite there being no lsuch conditions of service and has also noticed bona fide of the employer to provide further accommodation subject to availability of land and construction of houses thereon. However, this attempt on the part of the employer has been construed as an implied condition making obligatory upon it to pay HRA to the workers who are not provided with free housing accommodation. In absence of any other criteria, the Tribunal has upheld HRA rate prescribed by the State Government for its employees and has followed the same by issuing direction to this effect to the petitioner employer.
15. To my mind, this approach of the Tribunal is not justified and reasonable in the context of the entire matter. To constitute a condition of service, there must be something more than mere conduct on the part of employer showing that it has given some benefit to to some of its employees. There must be something to show that the employer intends to provide the benefit as a part and parcel of the condition of service to workmen. If something is found in the agreement, there would be no difficulty but otherwise, the mere fact of granting certain benefit to some of the employees, ipso facto, would not and may not constitute an implied condition of service unless intention of the employer and kind of representation to the workmen to this effect is borne out from some material.
16. In the present case, the employer industry on their own have allotted residential accommodation available with them to the seniormost workers, free of cost, and even to those workers there does not appear to be any express or implied condition of service that such benefit or amenity shall be extended by the employer. The fact that nominal and negligible amount is charged from the workmen who are allotted housing accommodation also shows that the employer never intended to create any interest in the housing accommodation on the part of the concerned workmen and that is how only token amount is payable by the workmen which is termed as "maintenance charges".
17. In providing voluntary facility of housing accommodation, the industry follows a genuine principle of seniority so that those having longer service in industry may get facility of free accommodation first comparing to those who have lesser service. The issue in question in my view is squarely covered by Apex Court's decision in Patna Electric Supply Co. Ltd. (Supra). The Court, on the one hand, upheld the power of industrial adjudicatory forum to extend an existing agreement or making of new one or creation of new obligation or modification of old ones. It also held that it cannot be doubted that in appropriate cases, industrial adjudication may impose new obligations on the employer in the interest of social justice and with the object of securing peace and harmony between the employer and his workmen and full co-operation between them. In settling the dispute between the employer and workmen the adjudicatory forum under industrial law is not confined to administration of justice in accordance with agreement strictly. It can confer rights and privileges on either party which it considers reasonable and proper, though they may not be within the terms of any existing agreement. Its power is not confined to mere interpretation or executing contractual rights and obligations of the parties but it can create new rights and obligations between them which it considers essential for keeping industrial peace. However, that itself does not mean that whatever is considered by the Tribunal in interest of workers can be allowed without having a realistic approach in the context of the entire scenario, namely, the industry as well as workers and public at large. Once an industry is established, its sole object is not confined to generation of employment but the production which results in adding to public resources contribute for national development. Employment is one of the ancillary and subsidiary developmental activity which results due to establishment of the industry going for production. Health of the industry, its potential of survival and continuance, contribution towards national resources, etc., therefore, cannot be undermined. The general interest of entire public at large has also to be seen in such matters.
18. The Tribunal found, in the present case, that the area was extremely backward where the industry in question was set up in 1960. The State Government invited establishment of the petitioner industry offering certain exemptions and concessions at the relevant time so that in one of the most backward area in the State of U.P. an industry of substantial potential and of national importance may be established. The petitioner industry is contributing to national development which also includes defence requirement since it produces aluminium. The industry, instead of taking any undue advantage of lack of bargaining power of workmen, on its own and voluntarily constructed houses, colonies, etc. and to the extent accommodation is available, the same is being provided to workmen, following a valid criteria of seniority.
19. The Apex Court in Patna Electric Supply Co. Ltd. (Supra) has observed that housing accommodation of industrial labour is the primary responsibility of the State. In the context of present economic conditions of industries, it would not be expedient to impose an obligation of providing housing accommodation upon the industry. It also said that scheme of wages normally fixes the wages taking into account factors relating to availability of accommodation in the area concerned and other relevant factors. It has also taken note of the fact that Tribunals usually do not entertain employees' claim for housing accommodation and do not even allow a separate demand of house allowance as such. The Court has also deprecated casual approach of imposing obligation relating to housing facilities upon the industry. In para 22 of the judgment it said:
"..........The discussion of the problem in these two chapters shows that housing shortage can be conquered only by sustained and well-planned efforts made by the States and the industry together. It is a very big problem and involves the expenditure of a huge amount. Efforts are being made by the Central Government to invite the cooperation of industrial employers to tackle this problem with the progressively increasing financial and other assistance offered by the State Governments. But it is obvious that this problem cannot at present be tackled in isolation by Industrial Tribunals in dealing with housing demands made by employees in individual cases. In the present economic condition of our industries it would be inexpedient to impose this additional burden on the employers. Such an imposition may retard the progress of our industrial development and production and thereby prejudicially affect the national economy. Besides such an imposition on the employers would ultimately be passed by them to the consumers and that may result in an increase in prices which is not desirable from a national point of view. It is true that the concept of social justice is not static and may expand with the growth and prosperity of our industries and a rise in our production and national income, but so far as the present state of our national economy, and the general financial condition of our industry are concerned, it would be undesirable to think of introducing such an obligation on the employers today. That is why we think the Industrial Tribunals have very wisely refused to entertain pleas for housing accommodation made by workmen from time to time against their employers."
20. It is also said that before taking any view with respect to housing facility or HRA, in favour of the workmen, financial ability of industry to meet the additional burden must have to be considered.
21. Admittedly, from a perusal of the impugned award any such consideration is apparently lacking. Further, assumption on the part of the Tribunal that giving free accommodation to about 50% of workmen while depriving others even from house allowance is discriminatory, also has no basis for the reason that the facility of housing accommodation has not been extended by employer on a pick and choose method but subject to availability and is provided following the valid criterion of seniority. It is voluntary also.
22. Parity with State Government employees is also something which has misguided the Tribunal, inasmuch as, once it is held that housing accommodation is the prime responsibility of State, what is applicable to employees of the State Government would not apply suo motu to employees of a private industrial establishment. Besides, the Tribunal has also not considered anything as to how and why it was justified in awarding HRA at the rate of 10% of the basic salary from the date of appointment of workmen, inasmuch as, there is nothing on record to show that the workmen raised any such dispute immediately after their appointment or within a reasonable time thereafter. If some workmen have already worked for decades together without being dissatisfied with non-availability of housing accommodation or HRA in lieu thereof, and they are given housing accommodation seniority-wise as soon as it becomes available, the Court finds no justification to allow payment of HRA to such workmen with such a long retrospectivity causing an extraordinary financial burden on the employer. In fact, on this aspect also the tribunal has not at all considered anything and in a most casual and abrupt manner, also without application of mind, it has passed the award granting relief of house allowance from the date of appointment. This direction, therefore, also in my view is illegal and unsustainable.
23. In view of the above discussion, the Tribunal was not justified in answering the reference in favour of workmen and the amount of housing allowance awarded with retrospective effect, cannot sustain.
24. Resultantly, the writ petition succeeds and is allowed. The impugned award dated 29th April 1991 in Adjudication Case no. 40 of 1989 (Annexure 4 to the writ petition) is hereby quashed.
25. No order as to costs.
Dated. 27.4.2012 PS/AKn