BURN AND COMPANY LIMITED Vs. ITS WORKMEN

JUDGEMENT

(1.) This dispute between Burn & Company Limited, (Iron Works), Howrah and its workmen is over the profit bonus for the year 1960. Previous disputes between this Company and its workmen on question of bonus of the years 1951-52, 1953-54 and 1955-56 ended with awards of Industrial Tribunals in West Bengal. The dispute for the bonus payable for the year 1955-56 came up to this Court in appeal and was disposed of by its Judgment dated March 8, 1960. For the Companys financial year from May 1, 1958 to April 30, 1959, the bonus, if any, would be payable in 1960. The Company was prepared to pay bonus equivalent to 3 1/2 months wages but the workmen demanded much more. It appears that the Company has already made an advance of three months wages on the suggestion of the Deputy Labour Commissioner during negotiations for settlement. But the talks for settlement ultimately failed. On applying the principles laid down by this Court in the matter, the Tribunal worked out the net available surplus out of which the claim for bonus had to be made at Rs. 53.31 lacs. After taking into consideration that the Company had contributed Rs. 10.74 lacs towards the employees provident fund and the income-tax rebate which would be available to the Company in respect of the bonus payment, the Tribunal was of opinion that a sum of Rs. 35.20 lacs could be fairly distributed to the workmen as bonus. It has accordingly awarded bonus to the extent of 5 1/2 months wages. It has further directed that the amount of wages already paid in advance towards the bonus shall be set off against the bonus now awarded. Both the Company and the workmen have appealed against the award by special leave.

(2.) The main controversy, as it always is in these cases, is on the computation of the available surplus. Different statements have been filed by the several Unions by whom the workmen were represented showing a gross profit at rupees seven crores and thirty-five lacs and available surplus only a few lacs less than this. The Companys statement showed the gross profits at Rs. 1,48,891.72. From this prior charges which have to be deducted in arriving at the available surplus were shown as

(3.) The figure thus reached for available surplus is Rs. 1,95,932 which would be equivalent to less than 10 days wages for the workmen. The Tribunal in arriving at the figure of Rs. 53.31 lacs as available surplus has calculated the gross profits at Rs. 181.82 lacs. From this it has deducted Rs. 71.36 lacs for income-tax, Rs. 7.39 lacs as return on working capital and a further sum on account of rehabilitation. For rehabilitation it has deducted Rs. 23.66 lacs as "rehabilitation charges" exclusive of the sum of Rs. 20.37 lacs under the head Notional Normal Depreciation. As Mr. Sen who appeared before us for the Company in these appeals, fairly pointed out that there is an obvious mistake in this calculation inasmuch as the Tribunal having decided that Rs. 23.66 lacs should be that annual rehabilitation charges should not have deducted this entire amount after having already deducted Rs. 20.73 for Notional Normal Depreciation. Mr. Sen admits that if the decision that Rs. 23.66 lacs should be the annual rehabilitation charge allowable in the year in question, only an amount of Rs. 3.29 lacs should be deducted as prior charge in addition to Rs. 20.37 lacs already deducted under the head Notional Normal Depreciation. If the other figures stood as calculated by the Tribunal this would result in the increase of the available surplus to Rs. 73.68 lacs. It is also clear that if the Tribunals decision that Rs. 23.66 lacs is the proper rehabilitation charge allowable for the year in question is left undisturbed the available surplus would remain at about Rs. 51 lacs, even if all the other figures as computed by the Company in its statement were allowed to stand. For, as already stated the Companys claim for rehabilitation charges inclusive of Notional Normal Depreciation is over Rs. 72.64 lacs, i.e., about 49 lacs more than what the Tribunal has found as allowable.