' The short question which arises in this reference under section 50, I. R.
0., for the interpretation of a provision in a settlement reached on 22nd September, 4979, between the United Paints (Pakistan) Limited, the respondents herein, and the representative of the employees of the said Company, the applicants herein, is whether the annual increments granted under the said settlement can be set off against the Cost of Living Allowance payable under the Employees' Cost of Living (Relief) Act, 1973, and if so, from what date paragraph No, II of the Settlement, which relates to wages, reads as follows :- "Wages.- (a) The Management has agreed to give increase of Rs, 120 per month in the wages of the workers having completed three months' service on 30th June, 1979, with effect from 1st July, 1979.
(b) The Management has also agreed to give Rs, 35 raised on basic wages as annual increment to the workers who will complete 9 months of their services on 30th June, 1979, with effect from 1st July, 1980. This annual increment of Rs, 35 per month will also be revised annual increment for future years in the scale of Rs, 250-35-495 which is inclusive of Cost of Living Allowances."
2. It is the case of the applicant-Union that the workmen in the respondent Company are entitled both to the Cost of Living Allowance of Ks. 40 payable under subsection (4) of section 3 of the Employees' Cost of Living (Relief) Act, 1973, as well as the annual increment, as per settlement, which fell due for the first time on 1st July. 1980, but the Management has wrongly adjusted the cost of living payable under the said Act against the annual increment payable under the said settlement. On the other hand, the case of the respondent-Company appears to be that as the annual increment fell due and was payable on 1st July, 1980, it becomes effective on the said date, and consequently, the Company was entitled to adjust the Cost of Living Allowance payable under subsection (4) of section 3 of the Act against such increment. The Company also relied upon the following additional clause in the settlement in question :- "(g) In case of any increase in wages during the tenure of this settlement by Federal and/or Provincial Government the same will be adjusted against the aforesaid increase in wages and allowance given by the Management."
3.
3. It was pointed out by this Tribunal in the Case Prince Glass Works Ltd. v. Prince Glass Mazdoor Union, decided on 27th August, 1980, that it appears that the Legislature has prescribed two important qualifications for the settlement, agreements and awards amounts payable under which can be set off or adjusted against the Special Cost of Living A Allowance payable under the Amending Ordinance. They are firstly that the settlement, agreement or award should be announced on or after 1st January, 1980, and secondly, that it should become effective after the said date, or alternatively it should be announced and become effective within one year of the coming into force of the Amending Ordinance."
4. The above view was reiterated by this Tribunal in the subsequent case of United Woollen Mills Workers Union v. United Woollen Mills decided on 27th November, 1980. Since the Settlement, in the instant case, was admittedly executed by the parties on 22nd September, 1979 of the twin requirements for set off laid down under subsection (4) if section 3 of the Act has not been fulfilled, which are that not only that the Settlement should become effective on or after the first day of January, 1980, but that further it should also be announced on or after the aforesaid date. There may perhaps be some substance in the contention that the provision in the settlement regarding annual increment, or atleast the payment of the annual increment became effective on the dates that the increments fell due though it may be pointed out that there is a good deal of difference between the effective date of the Settlement and the date on which certain payments thereunder accrue, but in any case, the second requirement that it should have been announced on or after 1st January, 1980, is clearly wanting in the instant case, as admittedly the settlement was executed and reached on 22nd September, 1979.
5. The second ground on the basis of which the set off is claimed by the respondent-Company, namely, additional ground (G) in the settlement, is equally devoid of substance. Since the Legislature has permitted set off under the proviso to subsection (4) of section 3 of the Act, only in those cases where an amount (towards cost of living) is payable under the agreement or settlement, which has been announced and became effective on or after the 1st day of January, 1980, a set off on the basis of a settlement, which was announced much earlier would not be permissible merely because there was a provision in the Settlement to that effect. In fact such provision would be invalid as it would be contrary to the provision of the law. In the case of Prince Glass Works Ltd., while repelling the contention that a set off could be effected under a Settlement announced prior to 1st January, 1980, if there was a provision to that effect in the Settlement, it was observed as follows :- "Another circumstance which is required to be taken into consideration in interpreting the provisions of the Amending Ordinance is enshrined in the Maxim : expressio unius est exclusio alterious (the mention of one is exclusion of another). Though this maxim may not be of universal application, but in the instant case, I take the view that adjustment of money benefits granted to workmen under agreements, settlements and awards made after 1st January, 1980, having been expressly permitted by the statute, which otherwise makes the non-payment of the increase in the Cost of Living Allowance to workmen a penal offence, would exclude adjustments made under the awards, settlements and agreements made prior to that date. There was no sense in the Legislature specifying this out of date, if on account of the supposed sanctity attached to Settlements and agreements, a provision in a settlement that the benefits awarded under the settlement would be set off against the benefits awarded under any future law could be allowed to prevail. Such interpretation, in my respectful opinion, would be both against the express provisions of the law as well against the rule of biennial construction,"
6. I am, therefore, firmly of the view that the company is not entitled to set off the Cost of Living Allowance payable under subsection (4) of c section 3 of the Act against the annual increments payable to workman under paragraph 11 of the Settlement, dated 27th September, 1979. However, the Cost of Living Allowance payable under the Employees' Cost of Living (Relief) (Amendment)
Ordinance, 1981, which was promulgated on 28th June, 1981, can be adjusted against the increase falling due and payable after the date of the promulgation of the Ordinance. This position was fairly conceded by Mr. S. P. Lodhi, the learned representative for the applicants.