1982 PLP 790 (PLC(CS))

Explanation.‑For the purposes of this subsection any increase in wages accruing by virtue of the usual annual increment or promo tion to a higher grade, or an allowance (sot specifically given to provide relief due to a rise in the cost of living, shall not be deemed to be an increase intended to provide relief due to arise in the cost of living."

3. It was contended by Mr. Choudhry Rasheed, the learned coun sel for the applicant, that reading the provisions of the proviso of sub section (5) and keeping in mind the wording of tire said explanation to the subsection the intention of the Legislature appears to be that only such allowance as is specifically given to provide relief to the workmen against the rise in the cost of living would be affected by t he set off provided under the said subsection. From this premise he proceeded to argue that only dearness allowance, cost of living allowance and similar other allowances would be effected by the set off as they appropriately can be said to be given specifically to provide relief against rise in the cost of living, but other allowance including house rent allowance, con veyance allowance, efficiency allowance, etc. are the subject and the result of negotiations between the workers and the management and cannot be considered to be specifically given to provide relief due to rise in cost of living. In support of this construction, the learned counsel relied upon the expressions "specifically given" and "an allowance" appearing in the explanation. According to the learned counsel, if every allowance, which according to the settlement agreement was given due to rise in the cost of living was subject to set off by the employer, then the Legis lature should have used the words "any allowance" and not "an allowance", for the use of the words "an allowance" seems to suggest a specific allowance given for the purposes of relief against rise in the cost of living. The learned counsel further argued that his interpretation of the expression "an allowance" finds support from the expression "speci fically given" which expression according to him again names an allowance given expressly to provide relief against rise in the cost of living.

4. In the case of New Jubilee Insurance Company Ltd. v. District Judge, Karachi & others (C. P. No. D‑932/78), a Division Bench of the Karachi High Court examined the connotation of the words "specifically given" as contained in the explanation to section 8 of the Employees' Cost of Living (Relief) Act, 1973, the language of which explanation is substantially similar, to that used in the explanation to subsection (5) of section

3. Re jecting the contention that the expression "specifically given" connotes or implies specifically stated, the Division Bench observed as follows:‑ "In the third case reported in P L D 1979 Kar. 47, the entire matter related to the allowance and to the increase in wages. This makes a material difference in the approach to the controversy because where the allowance is in dispute the employer will be entitled to adjustment if it has only been given specifically as a relief due to rise in the cost of living. In this case under the first set tlement made in 1972 the company had agreed to pay conveyance allowance and medical allowance. However, under the second settlement made on 20th June, 1974 which was effective from 1st January, 1974 the rates of both these allowances were increased and the company further agreed to pay house rent and Karachi allowance for workers residing at Karachi. The company further agreed that if by virtue of any law any benefit would compulsorily be conferred on the workmen, such benefits would be allowed by the company. The settlement also provided that if any benefit so conferred by the settlement is enhanced or improved then the workmen would be entitled to the enhanced/improved benefit. When Employees' Cost of Living (Relief) (Amendment) Act, 1974, was passed by the Assembly the Union requested the company to allow minimum of Rs. 50 and maximum 10% of the salary as cost of living allowance. The company maintained that in view of section 8 of the above Act, the company would be entitled to adjust the additional benefits given under the second settlement while computing the additional benefit under the Amending Act of 1974. In these circumstances while elucidating section 8 of the Act following observation was made at page 53:‑ "Furthermore an explanation to section 8 has been added to with the object to make it clear that any sum which is not specifically given to provide relief due to the rise in the cost of living shall not be deemed to be an increase intended, to provide a relief due to rise in cost of living. This observation clearly illustrates that in the explanation the words "not specifically given" refer to the intention and factum of pay ment and not to the form of expression. Again it was observed:‑ "1f we read section 8 with its explanation, it becomes clear that only that amount which has been paid specifically to provide relief due to rise in cost of living is liable to be adjusted." This again vividly points out that words "specifically given" have bee construed as "paid specifically" and not "expressly mentioned. In para. 9 of the judgment it has again been observed" that section 8 read with its explanation contemplates adjustment of a sum which has been specifically paid by the employer to provide relief due to rise in cost of living then the employer is entitled to adjust ‑4 meat under section

8. Where such payment has been made but has not been expressly mentioned that it is to provide relief due to rise in cost of living than the employer will be entitled t adjustment provided he is able to prove that payment was mad for such purpose."

5. In the instant case, there appears to be no doubt that the increase in the house rent and conveyance allowance were given to provide relief against the rise in the cost of living. The provisions in the settle ment relating to these allowances read as follows:‑ House Rent Allowance.‑Keeping in mind the rise in the cost of living the company agreed that with effect from 1st May, 1981, the House Rent Allowance will be increased from 10% to 15% of the basic salary." "Conveyance Allowance‑Keeping in mind the rise in the cost of living the company has agreed that with effect from 1st May, 1981 the conveyance allowance will be increased from Rs. 52 p.m. to Rs. 104 p.m. Full Conveyance Allowance will be paid to workers with full attendance otherwise it will be paid on a pro rata basis de pending upon the actual attendance, i. e. Q Rs. 400 per day of actual attendance."

6. It will be seen that the settlement expressly states in the case of both the allowances that increases in the said allowances were made by' reason of the rise in the cost of living. The intention of the parties was thus clear that the increases in these allowances were being; made specifi cally on account of the rise in the cost of living.

7. I am accordingly of the view that in the instant case, no difficulty or doubt arises as to the interpretation of the terms of the settlement relating to the grant of payment of the house rent and conveyance allowances which could appropriately be referred, examined and resolved by this Tribunal. I would, therefore, reject the application in limine.