The Hon’ble Supreme Court, in Prantiya Vidhyut Mandal Mazdoor Federation and Others V/s Rajasthan State Elecricity Board and Others, 1992 held that arrears of wages are included under the definition of ‘Basic Wages” under the Provident Fund Act. In the instant case, the workers were awarded when an award gives revised pay-scales to employees, the employees become entitled to the revised emoluments and where the said revision is with retrospective effect, the arrears paid to the employees, as a consequence, are the emoluments earned by them while on duty. We do not agree with the Division Bench of the High Court that the wages which are substituted from back-date as a result of an award under the Act are not the basic wages as defined under the Fund Act. If the original emoluments earned by an employee were “basic wages” under the Fund Act, there is no justification to hold that the substituted emoluments as a result of the award are not the “basic wages”. The expression “basic wages for the time being payable to each of the employees” under Section 6 of the Act means the “basic wages” at the relevant time. When the existing pay-scales are revised with effect from back-date then the revised-wages posterior to that date are the “basic wages for the time being payable”.
