Judgment

S. C. AGRAWAL, J.:- This appeal by the workmen of Kettlewell Bullen and Company Ltd. (hereinafter referred to as the workmen) involves the question whether the workmen are entitled to Customary Bonus at the rate of 10.5 per cent of the total annual salary or wages in respect of the years 1974 to 1977.

2. By order dated September 11, 1979 the Government of West Bengal referred to the Eighth Industrial Tribunal (hereinafter referred to as the Tribunal) the following dispute for adjudication under Section 10 of the Industrial Disputes Act, 1947:

"Whether the workmen are entitled to customary bonus for the accounting years 1974, 1975, 1976 and 1977? If so, at what rate?"

Before the tribunal it was submitted by the workmen that the bonus was being paid to them since the year 1959 and that for the years 1959 to 1963 bonus was paid at the rate of three and a quarter months basic wages and for the- years 1965 to 1973 it was paid at the rate of 10.5 per cent of the total annual salary or wages and that in the year 1964, it was paid at the rate of 4 per cent on the basis of Payment of Bonus Ordinance, 1965. The management disputed the said claim of the workmen and asserted that the workmen were not entitled to claim Customary Bonus and that they were only entitled to Statutory Bonus at the rate of 4% payable under the Payment of Bonus Act, 1965 (hereinafter referred to as the Bonus Act). The tribunal by its award dated April 16, 1982 found that the bonus was paid by the management for a long period from 1959 onwards not on the basis of the profit calculation and usually in the month of September before Puja festival and that from 1965 to 1973 it was being paid at the uniform rate of 10.5 per cent and, therefore, the bonus which was being paid by the management had ripened into a Customary Bonus due to a long usage. The tribunal held that the workmen were entitled to fixed Customary Bonus at the rate of 10.5 per cent of the annual salary or wages earned by each concerned workmen for the years 1974 to 1977. The said Award was challenged by the management before the Calcutta High Court in a writ petition filed under Article 226 of the Constitution. The said writ petition was allowed by a learned single Judge of the said High Court by judgment dated September 21, 1982* whereby the learned single Judge set aside the award made by the tribunal on the view that the workmen had failed to establish that they were entitled to Payment of Customary Bonus. The said decision of the learned single Judge was confirmed, in appeal, by a Division Bench of the High Court by judgment dated November 17,1986. The present appeal is directed against the said judgment of the Division Bench of the High Court.

* Reported in 1983 Lab IC NOC 80 (Cal).

3. Since the appeal relates to demand for customary bonus, it is necessary to mention that customary bonus differs from the bonus (as normally understood) based on the general principle that labour and capital should share the surplus profits available after meeting prior charges. Customary bonus has also to be distinguished from bonus claimed as an implied term of the contract of employment. The circumstances in which an implied agreement may be inferred have been laid down in M/s. Ispahani Ltd. Calcutta v. Ispahani Employees Union (1960) 1 SCR 24, 289 .

4. In Grahams Trading Co. (India) Ltd. v. Its Workmen, (1960) 1 SCR 107: bonus sought as a matter of tradition or custom, has been distinguished from bonus payable as an implied term of employment and it has been laid down that for determining whether the bonus is payable by way of custom or tradition the following matters be taken into consideration:

"(i) whether the payment has been over an unbroken series of years; (ii) whether it has been for a sufficiently long period, though the length of the period might depend on the circumstances of each case even so the period may normally have to be longer to justify an inference of traditional and customary puja bonus tha