The availability of surplus for bonus distribution must be determined on the basis of practical considerations, taking into account the difficulties in giving effect to abstract theoretical considerations, and the inability of the employer to bring part of its profits from one country to another.

( 1 ) THIS appeal arises out of an industrial dispute between the appellant M/s. Ganesh Flour Mills Co. Ltd. , and its employees. The appellant company is a Joint Stock Company incorporated and registered at Delhi under the Indian Companies Act, 1913. It has three factories at Delhi, one Vegetable Ghee Factory, one Flour Mills and one Breakfast Food factory. It also runs a Vegetable Ghee Factory at Kanpur and a Vegetable Ghee Factory and a Flour Mill at Lyallpur in West Pakistan. For the accounting year 1952-53, the appellant's employees claimed bonus equivalent to six months' basic wages and annual increment in basic wages on the same scale as for the year 1948-49. The industrial dispute arising out of this claim was referred by the Chief Commissioner, Delhi, to the Additional Industrial tribunal, Delhi, on 20/09/1954. By this reference, two issues were raised for adjudication of the tribunal. In the present appeal we are concerned with only one of these two issues and that is in relation to the employees claim for bonus for the year 1952-53. The appellant urged before the tribunal that for the year in question the appellant had no surplus available in its hands for distribution by way of bonus. This contention was rejected by the tribunal and the tribunal awarded to the respondents bonus equivalent to 25 per cent. of the basic wages subject to certain directions given by the award. This award was pronounced on 31/01/1955. Against this part of the award, both the appellant and the respondents preferred appeals before the Labour Appellate tribunal. The Labour Appellate tribunal confirmed the award of the industrial tribunal and dismissed the appeals preferred by both the appellant and the employees in that behalf. This decision was pronounced on 16/07/1955. It is against this decision that the present appeal has been filed by the appellant in this court by special leave.

( 2 ) THE legal position in regard to the employees' claim for bonus is no longer in doubt. The full bench formula evolved by the Labour Appellate tribunal in the case of the Mill Owners Association, Bombay v. Rashtriya Mill Mazdoor Sangh, Bombay, 1952) 2 Lab AC 433 (A), is accepted by both the parties. In the present case, after applying the full bench formula, the appellate tribunal has reached the conclusion that the available surplus is Rs. 9,61,371. 00. This conclusion has been reached after providing for prior charges as recognized by the full bench formula. The appellant's grievance is that adequate provision has not been made in respect of prior charges, no provision has been made at all for rehabilitation charges and the claim made by the appellant in respect of irrecoverable debts has been wrongly rejected. Besides, it is the appellant's case that basically the tribunals erred in holding that the available surplus should be determined on the footing that the business carried on by the appellant in India as well as the business carried on in Pakistan should be taken to constitute one business and the consolidated account of profit and loss of this entire business should be taken into account. The appellant's business in India during the relevant year has resulted in a loss and that, according to the appellant, is decisively against the respondents claim to any bonus during the relevant period.

( 3 ) THE learned Attorney-General contends that having regard to the true nature and character of the employees' claim for bonus, it would be necessary for the employees to show that the surplus from which they claimed the bonus was the result of the contribution of their labour. In support of this argument, reliance is placed on a decision of this court in Muir Mills Co. Ltd. v. Suti Mill Mazdoor Union, Kanpur, 1955-1 SCR 991: AIR 1955 SC 170)' (B ). The judgment of this court in this case has laid down two conditions which have to be fulfilled before a demand for bonus can be sustained, the wages paid to workmen must fall short of the living