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SUPREME COURT OF INDIA
24th November, 1961
P.B. GAJENDRAGADKAR, A.K. SARKAR AND K.N. WANCHOO, JJ.
The Management of Tocklai Experimental Station represented by the Indian Tea Association, Appellant
Versus
The Workmen and another, Respondents and Vice Versa.
Civil Appeals Nos. 459 and 460 of 1960.
Advocates appeared
Mr. M. C. Setalvad, Attorney-General, for India and Mr. B. Sea, Senior Advocate (M/s. S. N. Mukherji and B. N. Ghosh, Advocates, with them), for Appellant (In C. A. No. 459 of 60) and Respondent (In C. A. No. 460 of 60), Mr. S. T. Desai, Senior Advocate (M/s. A. K, Dutt and Janardan Sharma, Advocates, with him), for Respondents (In C. A. No. 459 of 60) and Appellants (In C. A. No. 460 of 60).
INDUSTRIAL DISPUTES ACT, 1947 - S. 10(1)(d) - BONUS - CLAIM FOR - CONDITIONS PRECEDENT - YEAR FOR WHICH CLAIM MADE - SURPLUS AVAILABLE - INDUSTRIAL PROFIT BONUS - FORMULA FOR DETERMINING - PUJA BONUS - CUSTOMARY PUJA BONUS - CONDITIONS FOR VALIDITY - IMPLIED TERM IN CONTRACT OF EMPLOYMENT - HOUSING ACCOMMODATION - DEMAND FOR - FINANCIAL POSITION OF EMPLOYER - STATE'S RESPONSIBILITY.
Fact of the Case:
The workmen of the Tocklai Experimental Station, an institution established by the Indian Tea Association for research purposes, made six demands, three of which were referred for adjudication by the Assam Government. The tribunal rejected the demand for pension in lieu of gratuity, partially allowed the demand for free housing accommodation or adequate allowance in lieu thereof, and partially allowed the demand for bonus by directing the Station to pay puja bonus at the same rate as the employees working for the Indian Tea Association at Calcutta.
Finding of the Court:
The Supreme Court held that the demand for profit bonus was not validly made as it did not specify the year for which the claim was made and did not allege that there was available surplus in the hands of the employer during that year. The award of puja bonus was also set aside as it was not a demand made by the workmen and was not expressly referred to the tribunal. The tribunal failed to consider that it was making out an entirely new & inconsistent case for the workmen and granting the said claim without any proof of the relevant facts which would support such a claim. The demand for housing accommodation was also rejected as the financial position of the Station could not bear the burden involved in the said demand.
Issues: 1. Whether the demand for profit bonus was validly made? 2. Whether the award of puja bonus was valid? 3. Whether the demand for housing accommodation was justified?
Ratio Decidendi: 1. A claim for profit bonus can be validly made only by reference to a particular year and has to be made from year to year. A general claim for the introduction of profit bonus cannot be made or entertained. 2. A claim for puja bonus can be made on the ground that it is a customary bonus or an implied term in the contract of employment. The course of conduct spreading over a reasonably long period between the employer and the employees in the matter of payment of puja bonus is of considerable importance in dealing with the claim of customary puja bonus. 3. A demand for housing accommodation can be reasonably entertained where it appears that the financial position of the employer can bear the burden involved in the said demand.
Final Decision: The Supreme Court set aside the award of the tribunal in respect of bonus and housing accommodation. The appeal of the workmen was dismissed.
Judgment
GAJENDRAGADKAR, J. : Civil Appeals Nos. 459 and 460 of 1960 are cross appeals and they arise out of an award pronounced by the Industrial Tribunal, Assam, in an industrial dispute referred by the Assam Government for its adjudication. This industrial dispute was raised against the management of the Tocklai Experimental Station (hereafter called the Station) by its workmen. Six out of the demands made by the workmen formed the subject-matter of reference. In the present appeals we are concerned with three of them. . Demand No. 1(a) was that the employees junior staff of the Station should be given pension in lieu of the existing practice of paying gratuity. This demand has been rejected by the tribunal. The other demand made by the employees was No. 3(b) and it had reference to the claim for free housing accommodation or adequate allowance in lieu thereof. This demand has been partially allowed by the tribunal and it has directed that house allowance in each case shall be raised at the flat rate of Rs. 20/- instead of Rs. 10/-. The decision of the tribunal in respect of these two demands did not satisfy the workmen and so by special leave of this Court they have filed Civil Appeal No. 460 of 1960. The demand of the junior staff for bonus which was resisted by the Station : has been partially allowed by the tribunal. It has ordered that the Station shall give puja bonus at the same rate as the employees working for the Indian Tea Association at Calcutta are getting. This part of the award is challenged by the Station in its appeal by special leave by Civil Appeal No. 459 of 1960. That is how the two cross-appeals arise.
2. We will deal first with the Station s appeal in respect of bonus. The learned Attorney-General contends that in making the demand for bonus the workmen have entirely misconceived the true position of the industrial law on the point, and he argues that the Assam Government was not justified in making the reference in the form it has been made and the tribunal was not justified in making the award in the manner it has done. The workmen made their demand for bonus in these words: "The Union requests the introduction of bonus for the Toklai Staff in the following grounds." Then follow six grounds. It was urged that the Station is an arm of the tea industry and is maintained by the members of the I. T. A. who give bonus to their employees, that the Station exists and works for the advancement of the tea industry and increasing its profits and thus is an industry, that the I.T.A. employees at Calcutta office are given bonus, that the employees of the Bengal Chamber of Commerce receive bonus that the employees of Shamshernagar and Tulsipara branches of this very Station used to be given bonus so long as these branches were functioning and that the personnel of the scientific research laboratories attached to many industrial concerns receive bonus, and so the workmen in the present case were entitled to make a claim in that behalf. In appreciating this claim it is necessary to state that the Station is a research institution established by the Indian Tea Association to make research for the purpose of improving the quality of tea and its production and the said Station is managed by the parent Association and is maintained by means of voluntary subscriptions from members of the said Association. Broadly stated the ground on which the workmen claimed bonus was trial the employees of the Association were receiving bonus and that the personnel of scientific research laboratories similarly situated in other industrial concerns were also given bonus.
3. When the Assam Government made the present reference it included within the scope of the reference this claim of bonus along with the other claims made by the workmen. The issue referred for adjudication on this point was thus framed:
2(a) Whether the demand of the employees " junior Staff) for bonus justified? If so, at what rate should the same be Paid ?
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