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Any conveyance allowance/traveling allowance is excluded from the definition of wages

Citation : Talema Electronic India Private Limited Vs. Regional Director, Esi Corporation & Anr., Civil Appeal No.3175 Of 2022

Date of Judgment/Order : April 25, 2022

Court/Tribunal : The Supreme Court Of India

Corum : M.R. Shah; B.v.nagarathna, JJ.

Background

The employer (appellant) had claimed that "conveyance allowance" paid to the employees are not part of the wages which was accepted by the ESI but was rejected by the Madras High Court. Hence this appeal.

Judgment

Quashing the order of the High Court, the Supreme Court referred to the recent decision of this Court in the case of Employees State Insurance Corporation v. Texmo Industries, 2021 (7) SCALE 438, by which on interpretation of Section 2(22)(d) of the ESI Act, it is observed and held that the "conveyance allowance" is equivalent to the traveling allowance and therefore any conveyance allowance/traveling allowance is excluded from the definition of "wages" in the above clause, the impugned judgment and order passed by the High Court is unsustainable and the same deserves to be quashed and set aside.

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