The minimum bonus under Section 10 is payable only when the conditions mentioned in Section 16 are satisfied.

1. This petition, by the employer seeking to set aside an award, Ex. P-4 of the Industrial Tribunal, Calicut awarding 4% bonus for the years 1966-67 and 1967-68 each of the years ending on the 30th of June, has come up before us on a reference order which states that the inter-relationship between S.10 and 16 of the Payment of Bonus Act, 1965 (hereinafter referred to as the Act) arises for consideration in the case.

2. S.10 of the Act is in these terms:

"10. Payment of minimum bonus: Subject to the provisions of S.8 and 13, every employer shall be bound to pay to every employee in an accounting year a minimum bonus which shall be four per cent of the salary or wage earned by the employee during accounting year or forty rupees, whichever is higher, whether there are profits in the accounting year or not:

Provided that where such employee has not completed fifteen years of age at the beginning of the accounting year, the provisions of this section shall have effect in relation to such employee as if for the words "forty rupees", the words "twenty five rupees" were substituted."

And S.16 (1) (a) & (b), leaving out the proviso and the explanations thereto, which are the only relevant provisions in S.16 arising for consideration runs thus:

"16. Special provisions with respect to certain establishment: (1) Where an establishment is newly set up. whether before or after the commencement of this Act, the employees of such establishment shall be entitled to be paid bonus under this Act only:

(a) from the accounting year in which the employer derives profit from such establishment; or

(b) from the sixth accounting year following the accounting year in which the employer sells the goods produced or manufactured by him or renders services, as the case may be, from such establishment, whichever is earlier."

It is not disputed before us that S.16 (i)(b) has any application for, the 6th accounting year following the accounting year in which the employer started selling goods produced or manufactured by him not been reached in 1966-67 or 1967-68. The only contention is that S.16(1) (a) is applicable because for the accounting years concerned, the employer had derived profit from the establishment. The finding of the Tribunal is also to this effect. It is stated in Ex. P-4: "On this basis I find that this management has not incurred any loss during these years and they have made sufficient profits for payment of bonus."

The basis is that the depreciation charged in the balance sheet of the company which has been duly audited, and interest debited for the loss sustained by the company should not have been deducted from the total profits of the two years because it was contended by the workmen that the depreciation is excessive and interest need not have been paid. In accepting this contention without any material, the Tribunal omitted to notice S.23 of the Act. We shall read S.23: "23. Presumption about accuracy of balance sheet and profit and loss account of corporations and companies: (1) Where, during the course of proceedings before any arbitrator or Tribunal under the Industrial Disputes Act, 1947 (14 of 1947), or under any corresponding law relating to investigation and settlement of industrial disputes in force in a State (hereinafter in this section and in S.24 and 25 referred to as the "said authority") to which any dispute of the nature specified in S.22 has been referred, the balance sheet and the profit and loss account of an employer, being a corporation or a company (other than a banking company), duly audited by the Comptroller and Auditor-General of India or by auditors duly qualified to act as auditors of companies under sub-s. (1) of S.226 of the Companies Act, 1956 (1 of 1956), are produced before it, then; the said authority may presume the statements and particulars contained in such balance sheet and profit and loss account to be accurate and it shall not be necessary for the corporation or the company to prove the accu