In Brief

The Supreme Court dismissed a Special Leave Petition by the Employees State Insurance Corporation challenging orders that excluded Conveyance Allowance from 'wages' under the Employee State Insurance Act, 1948. The Court held that Conveyance Allowance falls within the definition of 'Travelling Allowance' in Section 2(22)(b) of the ESI Act and is therefore excluded from wages. The nature and purpose of the allowance—enabling employees to commute to work—determines its classification, not whether it is paid regularly. The Court rejected distinctions between occasional travelling allowance and fixed monthly conveyance allowance, affirming that both serve the same purpose and should be excluded from wages calculations.

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