INDIAN LINK CHAIN MANUFACTURERS LIMITED WORKMEN OF INDIAN LINK CHAIN MANUFACTURERS LIMITED Vs. THEIR WORKMEN:THE MANAGEMENT

JUDGEMENT

(1.) THE Government of Maharashtra had referred the dispute between the Appellant and its Workmen to the Industrial Tribunal under the Industrial Disputes Act 1947 (hereinafter called 'the Act') in respect of Wage scales, dearness allowance, bonus, gratuity and permanency. THE Award made by it is the subject matter of this Appeal by Special Leave (Civil Appeal No. 204 of 1967) in which the dispute relating to wage scales and dearness allowance is contested only on the ground that there was a settlement between the workmen and the employers in a conciliation proceeding and as that has not been terminated by either party the Government has no jurisdiction to refer the dispute in relation thereto to the Tribunal. If this plea is not accepted the wage scales and dearness allowance as awarded by the Tribunal is not challenged. THE claim for bonus as awarded is disputed as it often happens, on the manner and method of computation of depreciation and development rebate. It is the case of the employers that it has not the financial capacity to bear the burden of the gratuity scheme framed by the Tribunal for the workmen. Apart from this certain incongruities in this scheme are pointed out to which we shall refer and deal with at the appropriate place. THE fifth issue relating to permanency is not pressed.

(2.) THE workmen have also filed an Appeal (Civil Appeal No. 610 of 1967) against the Award in which the omission by the Tribunal to grant an adjustment in the wage scale by directing a fitment of the wages of workmen in the said scales in accordance with the length of their service is assailed. It is also pointed out that the Tribunal did not link the dearness allowance granted by it with the cost of living index and lastly the award did not compute the return on reserves in accordance with the Schedule 3 of the Payment of Bonus Act (hereinafter called 'the Bonus Act').

(3.) ON the dispute relating to the payment of bonus, the case of the Appellant was that its profits for the year 1964 before depreciation was Rs. 4.11,176.00, and that under the payment of Bonus Act the available surplus was Rs. 19,921.00 out of which an allocable surplus would amount to Rs. 11,977.00. The Tribunal however, in arriving at its own computation of available surplus and allocable surplus disallowed the claim of the Appellant for a sum of Rs. 1,81,054.00 on account of depreciation and Rs. 5822.00 in respect of the development rebate reserve and instead it allowed depreciation of Rs. 80,190.00 and development rebate of Rs. 3,917.00 as shown in the balance-sheet. In respect of these items the reason given by the Tribunal is that while it is true the Company was entitled to deduct by was of depreciation an amount admissible in accordance with Section 32 (1) of the Income-tax Act by virtue of Sec. 6 (a) of the Bonus Act, there was no material on record to show that the deduction in respect of the aforesaid items was actually made by the Appellant in accordance with the relevant provisions of the Income-tax Act. In these circumstances it did not accept the deduction claimed by the Company, which were admissible under the Bonus Act.