Judgment

GAJENDRAGADKAR, J. : These two cross appeals arise from an industrial dispute between the Standard Vacuum Refining Co. of India, Ltd., (hereinafter called the appellant) and its workmen (hereinafter called the respondents). This dispute related to a claim for bonus made by the respondents against the appellant for the year commencing on January 1, 1956, and ending with December 31, 1956. The respondents claimed that for the relevant year they were entitled to receive by way of bonus their nine months total earnings inclusive of all allowances and overtime and extra-time earnings. After this demand was made the conciliation officer attempted conciliation between the parties but his efforts failed, and so he submitted a failure report under S. 12(4) of the Industrial Disputes Act XIV of 1947. The Government of Bombay then considered the said report and was satisfied that there was a case for reference of the said dispute to the tribunal. That is how the present reference came to be made under S. 12(5) of the Act.

2. The respondents who have made the present claim include 648 employees; amongst them 524 are operatives and 124 belong to the clerical cadre. Before the tribunal the respondents case was that during the conciliation proceedings the appellant had admitted its capacity to pay and to meet the entire claim of bonus made by them; and so it was urged that it was unnecessary to screen the respondents claim through the Full Bench formula. They further alleged that the appellant was not paying a living wage to the respondents and there still remained a large gap between the wage actually received by them and the living wage to which they would be ultimately entitled. According to the respondents their claim for bonus should be examined solely by reference to the gap which had to be filled up between the two wages; and in determining the amount of bonus all the legitimate requirements of the respondents should be carefully considered.

3. This claim was denied by the appellant. It denied the respondents allegation that during conciliation proceedings it had admitted its capacity to pay the entire amount of bonus claimed by the respondents. It then specifically averred that in law the respondents were not entitled to any bonus because the appellant was paying them a living wage, and so one of the essential conditions for the payment of bonus, namely, the need to fill the gap between the actual wage and the living wage was absent in the present case. The appellant then set out its calculations in regard to the average wages paid to the different categories of respondents and supported its plea that they were not entitled to any bonus at all. It may be added then the appellant had already voluntarily paid three months basic wages to the respondents by way of bonus, but since the respondents were making a much larger claim the appellant thought it necessary to raise this general issue of law and to contend that the respondents were not entitled to any bonus at all.

4. On these pleadings the tribunal had to consider the said question of law, but it appears that the material produced before it was so limited and meagre that it thought it would not be possible to arrive at any definite opinion on the question of what is the living wage in Bombay apparently the tribunal also throught that it was unnecessary to do so, because it has observed that the present dispute did not relate to wage scales and that the living wage was an illusive concept. Even so, having broadly considered the contentions raised by the appellant it held that "the wages are fair but there is still in a large number of cases a gap between the actual wage and the living wage". On this finding the tribunal proceeded to examine the other contentions raised by the parties in regard to the quantum of bonus which should be awarded and it reached the conclusion that the respondents were entitled to receive five months basic earnings "excluding dearness and other all