' Petitioners above-named, being aggrieved by order dated 24th February, 1980 and 15th April, 1980 passed by respondent No, 2, to the extent that the cost of living allowance of Rs, 110 was admissible to the respondent No. 1 in his gratuity prior to 1st May, 1977 and by order dated 26th July, 1980 of the respondent No, 3 to the extent that house rent allowance, conveyance allowance and the tea allowance were admissible to the respondent N. 1 for purposes of calculation his gratuity, on the termination of his services, have preferred this petition, inter alia on the following facts and grounds :- 2 The petitioners is a limited company, duly incorporated under the Companies Act, 1980, having its factory at T/17, S.I.T.E., Manghopir Road, Karachi. The respondent No. 1 was employed as a helper in the petitioners Company, for the period from 1st March, 1969 to 15th December, 1978 when he resigned from service and his resignation was accepted by the petitioners with effect from 16th December, 1978. The respondent No. 1 was drawing basic salary Rs, 290.00 per month, plus Rs, 110 as cost of living allowance with effect from 11th May, 1977 plus Rs, 40 on account of house rent allowance, plus Rs, 35 on account of conveyance allowance and Rs, 15 on account of tea allowance totalling to Rs, 490 per month, on the day of acceptance of his resignation.
3. That on the acceptance of the respondent's No, l's resignation, the petitioners offered gratuity for 200 days at the rate of Rs, 290 per month being his basic highest last drawn pay plus Rs, 110 per month on account of the cost of living allowance for 40 days only with effect from 1st May, 1977. The respondent No. 1 did not dispute his basic salary as well as gratuity for total 200 days as offered by the petitioners, but disputed the calculation thereof made by the petitioners as mentioned in para. 3 of the above petition and consequently, he filed an application No, 289/1979 under section 15 of the Payment of Wages Act, 1936, before the respondent No, 2, claiming earned wages at the rate of Rs, 290 per month as already offered by the petitioners and gratuity of 200 days at the rate of Rs, 490 per month, inclusive of cost of living allowance, house rent allowance, conveyance allowance and tea allowance, on the plea that these allowances were included in "wages" for the purposes of calculation of gratuity under the West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968.
4. According to the admitted facts, respondent No. 1-at the time of his resignation was drawing his monthly pay and allowances as under :- {{TABLE }}
(a) Basic pay
(b) Cost of living allowance
(c) House rent allowance
(d) Conveyance allowance
(e) Tea allowance Total:Rs. 290 Rs. 110 Rs. 40 Rs. 35 Rs. 15 Rs.490
5. The petitioners above-named, objected to the claim of gratuity at the rate of Rs, 490 per month, on the ground, that the house rent allowance, conveyance allowance and travelling allowance cannot be added to the wages, for the purpose of calculating gratuity, as the gratuity itself was excluded from the definition of "wages" in view of its very concept, that it is a small gift of money to a servant. As far as cost of living allowance, the petitioners stated, that in view of the amendment made in Employees' Cost of Living (Relief) Act, 1973 vide amending Act No, XXVI of 1976, which came into force on 1st May, 1977, the cost of living allowance for purposes of calculating gratuity could be added to the basic salary of the respondent No. 1 only from May, 1977.
6. The respondent No, 2, however, after taking into consideration the pleas of the parties, awarded gratuity at the rate of Rs, 410 per month, on the basis of the last pay drawn by the respondent No. 1, at the rate of Rs, 290 per month plus cost of living allowance of Rs, 110 per month from the date of employment, vide its orders dated 24th February, 1980 read with order dated 15th April, 1980.
7. The respondent No. 1 filed an Appeal No, 10 of 1980, against the orders dated 24th February, 1980 and 15th April, 1980 of the respondent No. 1, before the respondent No, 3, which appeal was ultimately accepted by the respondent No, 3, vide his order dated 26th July, 1980, by which he allowed calculation of gratuity at the rate of Rs, 490 per month, as claimed by the respondent No. 1, on the ground that the house rent allowance, conveyance allowance and the tea allowance were included in the definition of "Wages" as defined in the Payment of Wages Act, 1936.
8. The petitioners above named being aggrieved by the order dated 26th July, 1980 of the learned respondent No, 3 as well as by orders dated 24th February, 1980 and 15th April, 1980 of respondent No, 2 to the extent of including cost of living allowance prior to 1st May, 1977, have preferred this petition. Inter alia on the grounds mentioned in the above petition.
9. The learned counsel for the petitioners submitted, that orders dated 24th February, 1980 and 15th April, 1980 of the respondent No, 2 are without jurisdiction and/or in excess of jurisdiction, so also the judgment dated 26th July, 1980 of the respondent No, 3, as respondents Nos, 2 and 3 included cost of living allowance in the wages of the respondent No. 1, for purposes of calculating gratuity from the date of his employment, in view of the fact, that cost of living allowance was made part of the wages of worker with effect from 1st May, 1977, only, vide Amendment Act No, XXVI of 1977 and prior to this date the said allowance was specifically excluded as part of wages for calculation of gratuity, under section 7 of the Employees' Cost of Living (Relief) Act, 1973 (Act I of 1974) and further the learned counsel for the petitioner submitted, that order dated 26th July, 1980 of the learned Respondent No, 3 was without jurisdiction on additional ground, that the said respondent also allowed house rent allowance, conveyance allowance and tea allowance to be included in the Wages for purposes of calculating gratuity, on the basis of the definition of "Wages" as given in the Payment of Wages Act, 1936 whereas gratuity was admissible under the West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance 1968, under section 12(6) of the said Ordinance and as such the definition of Wages given in Payment of Wages Act, 1936 cannot be applied for purposes of calculating gratuity. In support of these contentions of his, the learned counsel for the petitioners relied upon case reported in PLD 1976 SC 208 and urged, that the said orders be deemed as without lawful authority, being without jurisdiction and/or in excess of jurisdiction of the respondents Nos, 2 and 3. The learned counsel for the petitioners further urged, that in view of the fact that "Wages" have not been defined in Standing Orders Ordinance, 1968, only ordinary dictionary meaning could be given to it and on the basis of this, basic pay plus cost of living allowance with effect from 1st May, 1977, could only be taken into calculation of Wages, for purposes of calculating gratuity, under section 12 (6) of the West Pakistan Standing Orders Ordinance, 1968, and as such orders of respondents Nos, 2 and 3 to this extent which are in violation of his submission, be set aside and the case be remanded back to the respondent No, 2, for re-calculation of the amount of gratuity on this basis only.
10. The learned counsel for the respondent, on the other hand, urged that the orders of respondents Nos, 2 and 3 being lawful and within the jurisdiction of respondents Nos, 2 and 3, the above Petition was not maintainable. In this connection, the learned counsel for the respondent relied on a case reported in PLD 1974 SC 139. In support of this contention of his, the learned counsel for the respondent urged, that in view of amendment of section 7 of the Cost of Living (Relief) Act, 1973, this allowance becomes part of Wages of the respondent No. 1 and as such under section 12 (6) of the West Pakistan (Standing Orders) Ordinance, 1968, the basic pay plus cost of living allowance became Wages admissible to him in the last month of service and consequently, respondent No, I was legally entitled to calculate his gratuity from the date of his employment on the basis of such wages. As far as addition of conveyance allowance, house rent allowance and tea allowance to respondent No. 1, wages for purposes of calculating gratuity, the learned counsel for the respondent urged that the definition of wages, for purposes of calculating gratuity means all remunerations capable of being expressed in terms of money, and that it would not include all monetary payments, but also payments made in kind which are capable of being expressed in terms of money except those which have been specifically excluded in the definition of wages as given in the Payment of Wages Act, 1936.
11. The learned counsel for the respondent further urged that the expression "the value of any house accommodation" is not synonymous to that of house rent allowance. These are two different expressions and convey different meanings altogether. In case of travelling, both the travelling allowance and the value of travelling concession have been excluded from wages. Had the Legislature any intention to exclude the house rent allowance, conveyance allowance as part of wages, it would have expressly expressed so, as has been done in case of travelling allowance.
Therefore, house rent allowance if it is given to the workers, is to be included into wages. Similarly, conveyance allowance and tea allowance are to be counted as part of wages.
12. I have taken into consideration the arguments advanced by learned counsel of both the parties and have gone through the orders of both the learned lower Courts and the reasoning given in the said orders.
13. The first contention of the learned counsel for the petitioners, that the cost of living allowance could only be added to basic salary from A 1st May, 1977, for purposes of calculating gratuity has no force. In my opinion, in view of the working of section 12 (6) of West Pakistan (Standing Orders)
Ordinance, 1968, which reads as under :- "Where a workman resigns from service or his services are terminated by the employer for any reason other than misconduct, he shall, in addition to any other benefit to which he may be entitled under this Ordinance or in accordance with the term of his employment or any custom, usage or any settlement or an award of a Labour Court under the Industrial Relations Ordinance, 1969 (XXIII of 1969), be paid gratuity equivalent to (twenty) days wages, calculated on the basis of the (wages admissible to him in the last month) of service, if he is a fixed rated workman or the highest pay drawn by him during the last twelve months, if he is a piece-rated workman) for every completed year service or any part thereof in excess of six months : ' Provided that, where the employer has established a Provident Fund to which the workman is a contributor, the contribution of the employer which is not less than the contribution made by the workman, no such gratuity, shall be payable for the period during which such Provident Fund has been in existence."
' According to above provisions, gratuity is to be paid on the basis of wages admissible to the employee in the last month of service, while in the present case on the admission of the petitioner such wages should be Rs, 290 basic pay plus Rs, 110 per month on account of cost of living allowance, by virtue of amendment of section 7 of Employees Cost of Living (Relief) Act, 1973 by Act No, XXVI of 1977, and as such the orders of respondents Nos, 2 and 3, by which respondent No, l's wages were calculated on this basis, from the date of his employment is in accordance with section 12 (6) of West Pakistan (Standing Orders) Ordinance, 1968. -14. The second contention of the learned counsel for the petitioners, that wages do not include allowance like, house rent allowance, conveyance allowance and tea allowance also, in my opinion, has no force. It is true that the word "Wages" has not been defined in West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance 1968. However, the word "Wages' has been defined in the Payment of Wages Act, 1936 as under :- "Wages" means all remunerations, capable of being expressed in terms of money, which would, if the terms of the contract of employment, express or implied, were fulfilled be payable, whether conditionally upon the regular attendance, could work on conduct or other behaviour of the person employed or otherwise, to a person employed in respect of his employment or to work done in such employment, and includes any bonus or other additional remunerations of the nature aforesaid which could be so payable and any sum payable to such person by reason of the termination of his employment has not include-
(a) the value of any house, accommodation supply of light, water, medical attendance or other amenity or of any (Provincial Government) ;
(b) any contribution paid by the employer to any pension fund or Provident Fund ;
(c) any travelling allowance or the value of travelling concession ;
(d) any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment ; or
(e) any gratuity payable on discharge."
15. Before 1973 it was not possible for an employee to move an application under section 15 of the Payment of Wages Act for enforcing payment of gratuity under the provisions of Payment of Wages Act, 1936. However, by Act XVII of 1973, section 15 of the Payment of Wages Act, 1936, was amended by which non-payment of dues relating to Provident Fund or gratuity payable under any law, could be claimed under section 15 of the Payment of Wages Act, 1936. In view of this, the definition of "Wages" given in the Payment of Wages Act, 1936 has been rightly applied to include these three allowances as part of wages drawn by respondent No. 1, at the time of his retirement, in the absence of definition of Wages under the Provisions of West Pakistan (Standing Orders)
Ordinance, 1968 by respondents Nos, 2 and 3. Even otherwise definition of W'ges as given in Law Lexicon, 14th Edn., p. 1052, reads as under :- "'Wages"-The Compensation agreed upon by master to be paid to servant, or any other person hired to do work of business for him."
In my opinion, the word 'compensation' is wide enough to include basic salary plus other allowances agreed to be paid in cash to the employee and even on basis of this definition, the orders of respondent No, 3 cannot be challenged by the petitioners and so such in my opinion, the said order of respondent No, 3, cannot be without lawful authority.
17. No other point was urged by the learned counsel for the petitioners before me.
18. In view of my above conclusions and findings, I see no reason to interfere with the orders dated 24th February, 1980 and 15th April, 1980 passed by respondent No, 2 and order dated 26th July, 1980 passed by the respondent No, 3 and so such find no merits in the above petition and consequently dismiss the above petition with costs.