Judgment
As delivered
PETITIONER:K.C. P. EMPLOYEES' ASSOCIATION, MADRAS
Vs.
RESPONDENT:MANAGEMENT OF K. C. P. LTD., MADRAS
DATE OF JUDGMENT24/01/1978
BENCH:KRISHNAIYER, V.R.BENCH:KRISHNAIYER, V.R.SINGH, JASWANT
CITATION:1978 AIR 474 1978 SCR (2) 6081978 SCC (2) 42CITATOR INFO :R 1982 SC 78 (8)
ACT:Payment of Bonus Act (Act 21), 1965, s. 3, provisoto--Applicability of.
HEADNOTE:Management-respondent is a public limited company carryingon three business adventures viz., manufacture of sugar, ofcement and of heavy engineering machinery, at threedifferent places. In respect of the workers of, theengineering unit known as Central Workshops and which wasfinancially ill, the management demurred the payment ofbonus under the Act for the years 1964-65 and 1965-66 on theground that the central workshop was a separate undertakingto which the proviso to Section 3 applied and consequentlythe claim for bonus on the basis of a single establishmentwithin the meaning of the main s. 3 was untenable. TheLabour Tribunal, however, upheld the claim of the workmenfor both the years. When the said two awards werechallenged by a writ petition, a single Judge of Madras HighCourt upheld the award for 1964-65. In further appeal bythe management, the Division Bench set aside both the awardsfor 1964-65 and 1965-66 and directed the Tribunal to correctcertain errors.Dismissing the appeals by special leave with directions forexpediting and completing the lis within three months, theCourtHELD : 1. In Industrial law, interpreted and applied in theperspective of Part IV of the Constitution, the benefit ofreasonable doubt on law and facts, if there be such doubt,must go to the weaker section, labour. [610 B-C]2.In the instant case : (a) Proviso to s. 3 is attracted.Separate balance sheet and profit and loss accounts havebeen prepared and maintained in the past and during therelevant years of accounting also and (b) The High Court isright in directing the Tribunal to re-enquire, rectify thebalance sheets and profit and loss accounts for the years inquestion taking due note of the requirements of the Act.[609 G-H, 610 A]Alloy Steel Project v. The Workmen, [1971] 3 SCR 620 (ratioinapplicable)
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 2142-2143of 1970.
Appeal from the Judgment and Order dated 3-9-1970 of theMadras High Court in Writ Appeals Nos' 350/68 and 76 of1969.
M. K. Ramamurthi, M. P. Dhar and Vineet Kumar for the Appel-lant.
V. M. Tarkunde and Naunit Lal for Respondent No. 1.B. P. Singh for Respondent No. 2.
For Respondent No. 3 in CA 2142 and RR 3-6 in C.A. 2143/70ex-parte.
The Judgment of the Court was delivered byKRISHNA IYER, J.-Affirming judgments need not speakelaborately, and so, in these two appeals where we do notdisagree with the High Court, only a brief statement ofreasons is called for.
The subject matter is a bonus dispute between themanagement respondent and the workmen union revolving roundthe applicability609of the proviso to Section 3 of the Payment of Bonus Act,1965 (hereinafter referred to as the Act) for the years1964-65 and 1965-66. A thumbnail sketch of the facts :
The K. C. P. Limited, a public limited company, carries onthree business adventures, viz., 'manufacture of sugar, ofcement and of heavy engineering machinery. The concernedfactories are in three different places in South India andemploy workmen on different terms in three different units.We are directly concerned with the engineering unit known atthe Central Workshops run at Tiruvottiyur, Madras. When thePayment of Bonus Act, 1965 came into force the workmen ofthis unit, which was financially faring ill unlike the othertwo sister units, demanded bonus on the footing that thethree different undertakings must be treated as onecomposite establishment and on the basis of the overallprofits, bonus must be reckoned as provided in the Act. Therespondent demurred on the ground that the Central workshopwas a separate undertaking to which the proviso to Section 3applied and consequently the claim for bonus on the basis ofa single establishment was untenably over-ambitious.Although the concerned unit was perhaps a losing propositionfor the relevant years, (we do not know for certain) theTribunal upheld the claim of the workmen for both the years,but the two awards were challenged, by Writ Petition, in theHigh Court. The award relating to 1964-65 was upheld by aSingle Judge of the High Court who took the view that sinceall the three units, though divergent and located indifferent places, were owned by the same company and,therefore, without more, were covered by the main part ofSection 3 and the proviso stood repelled. Two otherquestions, which had engaged the attention of the Tribunal,were scantily dealt with, the findings, if one may call themso, being adverse to the workmen. The management dulycarried an appeal before a Division Bench of that Courtwhich also called up and heard the Writ Petition against theaward relating to the year 1965-66. Both the awards wereset aside, the holdings on the substantial points beingadverse to the workmen. However, certain follow-up inquiryhad to be done by the Tribunal to correct errors, for whichlimited purpose there was a direction by the High Court.The matter stood at that stage and the two appeals in thisCourt are aimed against the decision of the Division Benchof the High Court.
The first point that appealed to the learned Single Judge,but failed before the Division Bench, has admittedly nomerit in the light of this Court's direct ruling on thepoint.
The second point urged by Shri M. K. Ramamurthy that the Central Workshop has had no 'separate, viable balance-sheet and profit and loss accounts in respect of' that undertaking, and that such is the finding of fact by the Tribunal, does not appeal to us. Nor is there life in the third limb of this argument that the respondent has failed to show that the Workshop has not been treated as part of the common establishment for the purpose of computation of bonus. We agree with the appellate judgment that the proviso is attracted. Separate balancesheet and profit and loss accounts have been prepared and maintained in the past and during the relevant years of accounting also, although 610 there is much force in the contention that they have not been' properly maintained. Some items which may help enhance the bonus have, perhaps, been omitted and the High Court is right in directing the Tribunal to re-enquire, rectify the balance-sheets and profit and loss accounts for the years in question taking due note of the requirements of the Act as mentioned in the judgment of the Division Bench vis-a-vis Central Workshop. We are in respectful agreement with the decision in Alloy Steel Project v. The Workmen(1) but do not regard the ratio of that case as applicable to the present case on the facts. In Industrial Law, interpreted and applied in the perspective of Part IV of the Constitution, the benefit of reasonable doubt on law and facts, if there be such doubt, must go to the weaker section, labour. The Tribunal will dispose of the case making this compassionate approach but without over-stepping the proved facts, correct the balance- sheets and profit and loss accounts of the Central Workshop to the extent justified by the Act and the evidence and finish the lis within three months of receipt of this order. The appeals are dismissed. No costs.
(1) [1971] (3) S.C R. 629.
