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1997 Supreme(Kar) 583

Karnataka High Court
Workmen, Bangalore Water Supply and Sewerage Board - Appellant
Versus
Bangalore Water Supply and Sewerage Board - Respondent
Decided On : 09-29-97
W.A. : 2097 of 1994

Advocates:
A.V.SRINIVASA REDDY, B.C.PRABHAKAR, H.NEELAKANTA RAO, J.N.RAJANNA SETTY, K.RAMACHANDRAN, M.C.NARASIMHAN

Headnote:General Clauses Act, 1897-Section 3(31), Payment of Bonus Act, 1965-Section 32(iv)-Definition of Local Authority-expression given in payment of Bonus Act does not define “local authority”-as such it has to be order understood as defined under General Clauses Act, 1897-Bangalore Water Supply and Sewerage Board not possessing required attributes can not be termed as local authority for purpose of exemption from payment of Bonus Act.

( 1 ) UNDER the industrial jurisprudence, bonus connotes claim of the workmen due to them beyond strict wages. Any extra consideration given for what is received, or something given in addition to what is ordinarily received by, or strictly due to the recipient is a bonus. It is also termed as wage incentives given to the labourer by the establishment for achieving higher productivity. The object of grant of bonus on the one hand is to increase earnings of the workers and on the other to improve the efficiency in the output in an industrial establishment. The Payment of Bonus Act (hereinafter called the 'act') was enacted to provide for payment of bonus to persons employed in certain establishments on the basis of profits or on the basis of production or productivity and for matters connected therewith. In the statement of objects and reasons to Act No. 21 of 1965, it was stated:"a Tripartite Commission was set up by the government of India by their Resolution No. WB-20 (9) of 1961, dated December 6, 1961 to consider in a comprehensive manner, the question of payment of bonus based on profits to employees employed in establishments and to make recommendations to the Government. The commission's Report containing their recommendations was received by the government on January 24, 1964, in their resolution No. WB 20 (3) of 1964, dated september 2, 1964, the Government announced acceptance of the Commission's recommendations subject to a few modifications as were mentioned therein. With a view to implement the recommendations of the Commission as accepted by the Government, the Payment of Bonus Ordinance, 1965, was promulgated on May 29, 1965. The object of the Bills is to replace the said Ordinance".

( 2 ) BEFORE the enactment of the Act the supreme Court in Titaghur Paper Mills company Limited v. Their Workmen (1959-II-LLJ-9) (SC) case recognised the payment of production bonus holding it to be dependant upon production in addition to wages. It held:"the extra payment depends not on extra profits but on extra production. The extra payment calculated on the basis of extra production is in a case like the present where the payment is made after the annual production is known, in the nature of emoluments paid at the end of the year. Therefore, generally speaking, payment of production bonus is nothing more nor less than a payment of further emoluments depending upon production as an incentive to the workmen to put in more than the standard performance".

( 3 ) IN Mumbai Kamgar Sabha, Bombay v. Abdulbhai Faizullabhai and Others, (1976-II-LLJ-186) the Apex Court held that the act was enacted on the subject of the profit based bonus. Statutory bonus was termed as profit bonus. Dealing with the concept of bonus and its development under the Industrial Law, the Court held:"bonus has varying conceptual contents in different branches of law and life. We are here concerned with its range of meanings in Industrial Law but, as expatiated earlier, there is enough legal room for plural pattern of bonus, going by lexicographic or judicial learning. It implies no disrespect to legal dictionaries if we say that precedents notwithstanding, the critical word 'bonus' is so multiform that the judges have further to refine it and contextually define it. Humpty Dumpty's famous words in 'through the Looking Glass' 'when I use a word. . . . . it means just what I choose it to mean. . . . neither more nor less' is an exaggerated cynicism. We have to bring in some legal philosophy into this linguistic problem as it incidentally involves doctrinal issues where the Constitution is not altogether non- aligned. Statutory interpretation, in the creative Indian context, may look for light to the lodestar of Part IV of the Constitution e. g. , Article 39 (a) and (c) and Article 43. Where two judicial choices are available, the construction in conformity with the social philosophy of Part IV has preference". " In Jalan Trading Company Private Limited v. Mill Mazdo



































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