JUDGMENT

SAWANT, J.- The question involved in these appeals is whether the ex-gratia payment made by the Coffee Board to its employees at the minimum rate at which bonus is payable under the Payment of Bonus Act [hereinafter referred to as the Bonus Act] is legal and further whether such payment could be made from the Pool Fund constituted under the Coffee Act, 1942 [hereinafter referred to as the Act]. The relevant facts in brief are as follow:

The appellant-Coffee Board is constituted under Section 4 of the Act. For the purpose of carrying out its activities under the Act, the Board engages various categories of employees. In the present appeals, we are concerned with the staff engaged for storing, curing and marketing coffee. The Board made an ex-gratia payment equivalent to the minimum bonus payable to the workmen under the Bonus Act for the years 1964-65 to 1968-69. There is no dispute that this payment was made by the Board after obtaining previous sanction of the Central Government. There is further no dispute that the concerned employees were made the said payment out of the Pool Fund constituted under the Act. The respondent-coffee planters challenged the said payment by filing different writ petitions before the Karnataka High Court. The learned Single Judge of the High Court upheld the said payment as legal and dismissed the writ petitions. In appeal, the Division Bench of the High Court reversed the said finding and held that the Bonus Act was inapplicable to the Coffee Board and, therefore, no bonus was payable under the Act. The bench also held that inasmuch as the payment was made out of the Pool Fund which was to be applied only for the purposes mentioned in Section 32 of the Act, the said payment was illegal on the ground that the purposes mentioned under the said section did not cover the payment to the employees by way of bonus. It is aggrieved by this decision that the Coffee Board and the Coffee Board Employees Association have preferred these appeals.

2. We are afraid that the Division Bench of the High Court has erred by considering the question as to whether the Bonus Act was applicable to the Coffee Board or not. On the undisputed fact that the payment in question was ex-gratia and not as bonus, the question whether the Bonus Act applied or not was irrelevant. The only question that fell for consideration was whether the payment could be made out of the Pool Fund. It is for this reason that it is not necessary for us to go into the question whether the Bonus Act applied to the Coffee Board or not. Mr Pai, learned counsel appearing for the respondents - owners/planters of coffee estates contended that Section 32 has laid down that the Pool Fund shall be applied only to "(a) the making to registered owners of estates of payments proportionate to the value of the coffee delivered by them for inclusion in the surplus pool; (b) the costs of storing, curing and marketing coffee deposited in and of administering the surplus pool; (c) the purchase of coffee not delivered for inclusion in the surplus pool"; "Provided that where, after the requirements of the clauses of this sub-section have been met, there remains any excess in the pool fund, the Board may, with the previous sanction of the Central Government, transfer the whole or any part of such excess to the credit of the General Fund". According to him, this does not include payment to employees either for securing better working conditions or for providing amenities and incentives to the workers. Nor does any one of the said purposes include expenses of the Board which may broadly be held to cover the expenses incurred on the maintenance of the staff. He submitted that the payment for both purposes is to be made from the General Fund since clauses (2)(a) and (e) of Section 31 of the Act specifically mention that it is the General Fund which shall be applied to meet both the said expenses. He further contended that sub-section (2)(b) of Section 32 which refer