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Application No.3KAR-615 of 1981, heard on 4th November, 1981.

S. 3 (5), proviso [as amended by Employees' Cost of Living (Relief) (Amendment) Ordinance (XXV of 1981)]-Set-off-How to be made-Cost of living allowance-To be set-off against payments required to be made under settlement and not vice versa-Increased payment under settlement totalling Rs. 35-Rs. 35 deduct able from statutory allowance of Rs. 40 payable under S. 3(5) and balance of Rs. 5 only payable.

Ch. Rasheed Ahmed for Applicant.

Mahmood Abdul Ghani for Respondents.

Date of hearing: 4th November, 1981.

This purports to be an application under section 50, I. R. O., for clarification of the order made by this Tribunal on 18th October, 1981 whereby it bad been held that four types of payments made to workmen, namely (1) additional. increment (2) increase due to revision of wages, (3) increase in the conveyance allowance, and (4) increase in the washing allowance, were subject to set-off under the Employees' Cost of Living (Relief) Act, 1973. This order, it appears, has been interpreted by the Prince Glass Works Ltd., the-respondents herein, as permitting them to set-off the aforesaid payments against the cost of living allowance, equal to Rs. 40 per month, payable to certain categories of workmen under subsection (5) of section 3 of the Act, on the other hand, the con tention of the applicant Union is that what the- Act contemplates is not the set-off of the payments or increase provided for' under a settlement or an agreement against the allowance of Rs. 40 payable under sub section (5) of section 3 of the Act, but the setting-off of the allowance under the said subsection against the increased payments provided for in the settlement or agreement. The importance of the different positions taken by the two sides lies in the fact that whereas the allowance pay able under subsection (5) of section 3 of the Act is not to form part of the wages of the workers the increased payments to be under the settle ment or agreement will ordinarily form part of the wages.

2. There would appear to be no difficulty or doubt in regard to the orders passed by this Tribunal on 18th October, 1981 if the said orders are read in full. In para. 4 of the said order it has been expressly stated that whereas the allowances payable under subsections (1), (2) and (3) of section 3 of the Act are not subject to set off by the employer, except as provided in section 8 the allowances payable under subsections (4) and (5) are subject to set off under certain conditions. The above observation was made after reproducing section 3 of the Act in extenso. The proviso to subsection (5) of section 3 of the Act, which is admittedly applicable to the facts of the present case, clearly provides that the cost of living allowance payable under the said subsection is to be set-off against the specified increases or payments made under the settlement. The observa tions, of this Tribunal in paragraph 4 of its order, thus, are in strict com pliance with the wording of the law.

3. Mr. Mahmood Abdul Ghani, however, sought to argue that because in paragraphs 9, 10 and 11 of its order, this Tribunal has observed that the four specified types of payments payable to the workmen under

the settlement are subject to set-off under the law, therefore, it is these payments under the settlement which are to be set-off against the cost of living allowance payable under subsection (5) of section 3 of the Act and not that the cost of living allowance is to be set-off against the increased payments to be made under the settlement. It may be noted that the words used in the order are not that the increase or payments to be made under the settlement are to be set-off against the cost of living allowance payable under subsection (5) of section 3 of the Act but that these in crease are subject to set-off. In other words, the set-off would be as provided by law in relation to and to the extent of these four increases. The matter is made clear beyond doubt by use of the words "under the law." In other words, the set-off, to the extent of the increased amount payable under the settlement to provide relief to the workers against the rise in the cost of living, is to be made as provided under the law. I have already shown that the law clearly contemplates that it is the cost of living allowance, which is to be set off against the payments required to, be made under the settlement and not vice versa. In other words, the increased payments to be made under the settlement, which are to be A taken into consideration for the purposes of set-off, total Rs. 35, then this amount of Rs. 35 would be deductable from the allowances of Rs. 40 payable under subsection (5) of section 3 of the Act and only the balance of Rs. 5 would be payable under the law while the payments to be made under the settlement would remain unaffected.

4. Mr. Ch. Rasheed Ahmed, on behalf of the workers, gave assu rance in the Court that the work in the respondent-Factory would be re commenced today from the next shift.

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