Article 7: (Arts. 7 and 102 of the Act of 1908):
The period of limit for a suit for wages in the case of any other person is three years and the time of limit and the time from which period begins to run is when the wages accrue due.
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ADVERTISEMENTS:
Article 7 applies to suits only. It has no application when a competent authority is considering the claim for arrears of salary of the reinstatement of the Government servant in pursuance of the decree of the Court. In Nityananda Joshi v. L.I.C. of India, (AIR 1970 SC 209), it has been held that Article 7 is not attracted for a claim of wages before a Labour Court under Section 33C(2) of the Industrial Disputes Act.
In Madliav v. State of Mysore, (AIR 1962 SC 8), the Supreme Court has held that wages includes pay or salary as well. Wages includes charge allowance, dearness allowance, bonus as per judgments of different High Courts. Even where the remuneration is paid by way of share of product it comes within the purview of the wages.
The Article 7 applies to a suit by Government servant for recovery of arrears of salary or pay. In Shivram v. Nagappa, (AIR 1936 Mad. 149), it has been held that a suit by an Archaka against the trustee for his allowance called Tasik attracts the Article 7. In S.D. Srivastava v. Union of India, (AIR 1974 SC 338), the Supreme Court has held that a claim for arrears of salary falls under the purview of Article 7 of Limitation Act, 963.
The suit for full salary during the suspension period on the ground that the order of suspension is invalid attracts the Article 7. A suit for recovery of arrears salary of a Government employee whose dismissal has been set aside is governed by the Section 7. A suit for recovery of the amount wrongfully deducted from salary as well as for charge allowance is governed by Art. 7.
ADVERTISEMENTS:
But, in H.G. Ghete v. B.H.V, (1990 Lab.I.C. 250 (All.), it has been held that when a pay of the Government servant has not been fixed, the suit for fixation of salary cannot attract Article 7 of the Limitation Act, 1963. Article 7 is not attracted to the winding up proceeding before the Company Courts under Section 528 of the Companies Act, 1956. Article 7 does not apply to applications under Section 15(2) of the Payment of Wages Act.
The limitation for filing a suit for wages governed by this Article is three years and the limitation starts from the date when the wages accrue due. The expression “when the wages accrue due” in Article 7 has to be liberally construed in a case when the services of the employee were wrongfully terminated and later on he was reinstated in service.
Ordinarily time runs from the date when the wages accrue due. In N.M. Siddique v. Union of India, (AIR 1978 SC 386), it has been held that the question when the wages in any particular case accrued due is one of facts to be determined with reference to the contract, if any, between the parties or in the absence of any contract by course of dealing between the parties.
In Angal v. State of Maharashtra, (AIR 1968 Bom. 304), it has been held that in the case of monthly wages the wages accrue and become due in law on the last day of the month and the period of limitation of each month’s wages begins to run from that date. Even if the services are terminated before the end of month, the date of termination of service will not be the starting point of limitation under the Art. 7 of the Limitation Act, 1963.
ADVERTISEMENTS:
In Union of India v. M.M. Datta, (1973 Lab.IC 308), it has been held that when the salary of an employee has not been determined, the right to sue for arrears of salary accrues to him when the wages or salary i are finally determined.
In D.N. Kaul v. State of Himachal Pradesh, (AIR 1985 HP 39), it has been held that the arrears could not be regarded as having accrued due to the petitioner before a formal order awaiting selection grade was made known to him.
When the Government servant was retrenched from service the cause of action for recovery of arrears of pay starts from the date of retrenchment.