Back
Andhra Pradesh High Court
Judges : A.LAKSHMANA RAO, D.JAGANNADHA RAJU
A.P.Co-operative Central agricultural Development Bank Ltd. - Appellant
Versus
A.P. Co-operative Agricultural development Bank Employees Association - Respondent
Decided On : 08-08-92
PAYMENT OF BONUS ACT - BONUS - CENTRALISED CADRE - EMPLOYEES OF AGRICULTURAL DEVELOPMENT BANKS - EMPLOYER - ESTABLISHMENT - WRIT PETITION - MAINTAINABILITY - ESTOPPEL: 1. The Payment of Bonus Act, 1965 is a complete code in itself and there can be no claim for bonus de hors the provisions of the Act. 2. The definition of "establishment" in the Payment of Bonus Act, 1965 is exhaustive and includes departments, undertakings, and branches. However, where a separate balance sheet and profit and loss account are prepared and maintained for a department, undertaking, or branch, it shall be treated as a separate establishment for the purpose of computation of bonus. 3. The employees of the Primary Agricultural Development Banks (P.A.D. Banks) are not employees of the Central Agricultural Development Bank (Central Bank) merely because they belong to a centralized cadre. The Central Bank does not have ultimate control over the affairs of the P.A.D. Banks, which are separate and distinct entities. 4. The employees of the P.A.D. Banks are not entitled to claim bonus from the Central Bank. They are entitled to claim bonus from the P.A.D. Banks in which they are working. 5. A writ petition is not maintainable for a claim of bonus in view of Section 22 of the Payment of Bonus Act, 1965, which provides that any dispute arising between an employer and his employees with respect to bonus payable under the Act shall be deemed to be an industrial dispute and shall be referred for adjudication by an industrial tribunal. 6. There can be no estoppel against a statute. The mistaken payment of bonus by the Central Bank to the employees of the P.A.D. Banks for two years does not estop the Central Bank from raising the contention that the employees are not entitled to bonus from the Central Bank.
Fact of the Case:
The petitioners, employees of the Agricultural Development Banks in Andhra Pradesh, filed a writ petition seeking a direction to the respondent Central Bank to continue paying bonus at the same rate as paid to its Head Office and Regional Office employees and for a declaration that a circular issued by the Central Bank reducing the bonus rate was illegal and violative of Articles 14 and 16 of the Constitution of India. The learned single judge allowed the writ petition and directed the Central Bank to pay bonus at 20% from 1981-82 to May 22, 1985, and quashed the circular reducing the bonus rate.
Finding of the Court:
The court held that the Central Bank was not the employer of the employees of the P.A.D. Banks who came under the centralized cadre and that the employees were not entitled to claim bonus from the Central Bank. The court also held that a writ petition was not maintainable for a claim of bonus in view of Section 22 of the Payment of Bonus Act, 1965, and that the Central Bank was not estopped from raising the contention that the employees were not entitled to bonus from the Central Bank.
Issues: 1. Whether the Central Bank was the employer of the employees of the P.A.D. Banks who came under the centralized cadre? 2. Whether the employees were entitled to claim bonus from the Central Bank? 3. Whether a writ petition was maintainable for a claim of bonus in view of Section 22 of the Payment of Bonus Act, 1965? 4. Whether the Central Bank was estopped from raising the contention that the employees were not entitled to bonus from the Central Bank?
Ratio Decidendi: 1. The Payment of Bonus Act, 1965 is a complete code in itself and there can be no claim for bonus de hors the provisions of the Act. 2. The definition of "establishment" in the Payment of Bonus Act, 1965 is exhaustive and includes departments, undertakings, and branches. However, where a separate balance sheet and profit and loss account are prepared and maintained for a department, undertaking, or branch, it shall be treated as a separate establishment for the purpose of computation of bonus. 3. The employees of the P.A.D. Banks are not employees of the Central Bank merely because they belong to a centralized cadre. The Central Bank does not have ultimate control over the affairs of the P.A.D. Banks, which are separate and distinct entities. 4. The employees of the P.A.D. Banks are not entitled to claim bonus from the Central Bank. They are entitled to claim bonus from the P.A.D. Banks in which they are working. 5. A writ petition is not maintainable for a claim of bonus in view of Section 22 of the Payment of Bonus Act, 1965, which provides that any dispute arising between an employer and his employees with respect to bonus payable under the Act shall be deemed to be an industrial dispute and shall be referred for adjudication by an industrial tribunal. 6. There can be no estoppel against a statute. The mistaken payment of bonus by the Central Bank to the employees of the P.A.D. Banks for two years does not estop the Central Bank from raising the contention that the employees are not entitled to bonus from the Central Bank.
Final Decision: The writ appeal was allowed, the judgment of the learned single judge was reversed, and the writ petition was dismissed.
( 1 ) THIS is an appeal filed by the respondent in Writ Petition No. 5816 of 1984. The writ petition has been filed by the employees working in the Agricultural development Banks in the State of Andhra Pradesh. The petitioners claim two reliefs. The first relief is to issue a writ of mandamus to direct the respondent- bank, namely, Andhra Pradesh Co-operative Central Agricultural Development bank (hereinafter called the Central Bank for brevity sake) to continue to pay bonus to all the centralised cadre employees at the same rate at which their employees in the Head Office and Regional Offices were paid during the years 1981-82,1982-83 and for all subsequent years. The second relief prayed for is for a declaration that Annexure a i. e. , circular letter No. 2/fa/acc. I/84-85 dated 4th January, 1985 of the respondent-bank is illegal, arbitrary and violative of Articles 14 and 16 of the Constitution of India. The learned single judge, by judgment dated 6th September, 1988, allowed the writ petition and directed the respondent to make payment of bonus at 20% from 1981-82 to May 22, 1985 and also quashed the Annexure a dated 4th January, 1985, as illegal.
( 2 ) THE facts pertinent for decision of the writ appeal are as follows; The appellant Central bank is the A. P. Co-operative Central Agricultural development Bank which is a co-operative society registered under the A. P. Co-operative Societies Act, 1964. It was originally constituted under A. P. Cooperative central Land Mortgage Bank (Formation) Act, 1961, which is a registered co-operative society. The Co-operative Agricultural Development banks in the State of Andhra Pradesh are registered co-operative societies under A. P. Co-operative Societies Act, 1964. They were admitted as members of the appellant-bank. For the sake of brevity, the Co-operative Agricultural development Banks will be called P. A. D. Banks" in this judgment. Originally the P. A. D. Banks had the power of appointment and disciplinary control over their employees. Subsequently centralised cadres werecreated. Under Section 114-A of the Co-operative Societies Act, the Board of Directors of the Central agricultural Development Bank was given the power to constitute a centralised service in P. A. D. Banks for certain posts, namely, Managers or Secretaries, engineering Supervisors, Assistant Managers or Assistant Secretaries and executive Officers and the Board had the power of appointment, transfer and disciplinary action in respect of the centralised cadre. Subsequently a centralised cadre was created for all other categories of employees also. This was done by virtue of a settlement under Section 18 (1) of the Industrial Disputes Act. The centralised cadres came into existence on 1-7-1981. By virtue of this, all former employees of the primary banks came under the centralised cadre and the board of the Central Bank had administrative and disciplinary control. Subsequently the centralised cadre was abolished except for the employees mentioned in Section 114-A of the Co-operative Societies Act. This was done under Section 114-B of the Co-operative Societies Act. During the relevant period 1981-82 onwards upto 1985, the employees, who are the petitioners, belonged to the centralised cadre. It is also an admitted fact that for the years 1979-80,1980-81, the appellant-Central Bank paid bonus at the rate of 20% to all the centralised employees of the P. A. D. Banks. When it came to the question of paying the bonus for the years 1981 -82,1982-83 and 1983-84, the appellant-Bank issued Circular letter now indicated as Annexure-A on 4-1-1985 advising the p. A. D. banks to pay bonus to all the employees working in the P. A. D. Banks as, per the PAYMENT OF BONUS ACT, 1965. On the very same day i. e. , 4-1-1985, the appellant-bank issued Annexure-B stating that the employees in the Head- office and Regional Offices of the Central Bank are entitled to bonus at 20%, feeling aggrieved by Anne
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
