Judgment

KRISHNA IYER, J. :- Industrial jurisprudence, based on the values of social justice which is integral to our Constitution, has been built around several legislations enacted by Parliament, one of which is the Payment of Bonus Act, 1965, (the Bonus Act, for short). The bonus branch of labour law, however, is not exhausted by this enactment and has been replenished by judge made law, drawing sustenance from practice and precedent, custom and contract. Against this back-drop, we have to state and assess the single issue strenuously canvassed before us by the appellant-management challenging the award of the Industrial Tribunal and urging that the Bonus Act, as amended by Act 23 of 1976, annihilates all species of bonus including customary and contractual bonus. The claim of the Union of Workmen is for customary bonus, the reference to industrial adjudication relates to customary bonus and the special leave to appeal granted by this court is confined to customary bonus as the common basis and focuses on the sole legal issue of negation of that kind of bonus by virtue of the provisions of the amending Act 23 of 1976.

2. The matrix of minimal facts necessary to highlight the limited controversy may lay bare the crucial issue we have to decide. The appellant is a jute mill in Bengal employing several thousand workers but we are directly concerned here with a dispute between the Management and the employees in its head office. Certain indisputable facts fundamental to the case, make a useful beginning. Customary bonus has been claimed, conceded and settled between the parties for long years since the early sixties at least. From time to time, this demand has been the subject of dispute and, fortunately, of agreed solution right down to 1975. But in 1976 - the year in which Art. 43-A making participation of workers in Management of Industries was made a Directive Principle in our Constitution - the Bonus Act was, paradoxically, amended restricting workers claim to bonus by Act 23 of 1976 although much of the curtailment has been can cancelled by the next Amending Act, 1977. Anyway, the changes wrought by the 1976 amendment emboldened the Management to deny the legality of customary bonus claimed by the workmen. The conflict led a reference by the State Government to the Industrial Tribunal of the following dispute :

"CUSTOMARY BONUS FOR THE YEAR, 1976"

3. What is material to notice is that the demand and the denial, the reference and the adjudication and, finally, the special leave itself revolved round customary bonus. The specific case of the Management was that customary bonus could no longer be payable, in view of the provisions of the 1976 amendment. A statutory fatality was sought to be spelt out of its provisions before the Tribunal and before us. We emphasize this to exclude a hazy, though half hearted plea mentioned by Shri. G. B. Pai for the appellant that here the bonus was based on agreement and no agreement as such could avail in view of S. 34, read with S. 31-A, (as amended by the 1976 Act). Apart from the law relied on, it is somewhat startling that bonus paid by settlement between the parties qua customary bonus at least since 1962-63 (see Page 4 of the paper Book) should be anathematized as untenable in 1976, suggesting that labour law, viewed from the social justice angle, is making headway steadily backwards. Even so, we will examine the law as the statute speaks.

4. The payments over the years have been of customary bonus. The demand for 1976, which alone directly concerns us, is also for customary bonus. The dispute referred is of customary bonus. The legal objection urged is to customary bonus. The award has upheld the tenability of customary bonus. The special leave petition complained about the legality of customary bonus and the order granting leave clinched the issue by treating the dispute as one for customary bonus. Likewise, throughout, the only defence of the management was the lethal impact on customa