BARODA BOROUGH MUNICIPALITY Vs. ITS WORKMEN

JUDGEMENT

(1.) This is an appeal by special leave from a decision of the Labour Appellate Tribunal at Bombay, dated 23-11-1955. The Baroda Borough Municipality is the appellant, and the respondents are the workman employed in the electricity department of the said p73 Municipality represented mostly by the Baroda State Electric Workers Union (hereinafter called the respondent union). The substantial question for determination in this appeal is if the respondents, workers in a municipal department engaged in the generation supply and sale p73 of electric energy are entitled to the bonus claimed out of the surplus earnings of the said department (called 'profits' by the respondents) after allowing for all outgoings including necessary expenditure of the department and deductions for all prior charges. The question is short one, but has an importance and consequences reaching beyond the limits of the particular case in which it has arisen.

(2.) We may first state the relevant facts. Before 1-5-1949, on which date the former State of Baroda was merged in and integrated with the Province of Bombay (now the Bombay State), the Baroda Electric Supply Concern was owned and managed by the State of Baroda. On 19-4- 1949, the State Government of Baroda decided to hand over the said Concern as a gift to the Baroda Municipality and communicated an order to that effect in which it was stated inter alia: -

(3.) Against this decision of the Tribunal, there was an appeal to the Labour Appellate Tribunal of India at Bombay. The Appellate Tribunal came to the conclusion that the respondents were entitled to claim bonus; it expressed the view that on the decision of this Court in D. N. Banerji v. P. R. Mukherjee, 1953 S C R 302: (AIR 1953 S C 58) (A), the expression 'industrial dispute' in the Industrial Dispute Act, 1947 includes disputes between municipalities and their employees in branches of work that can be regarded as analogous to the carrying on of a trade or business and if, the undertaking resulted in profit during the relevant trading period, the workmen were entitled to claim bonus as of right. On the question whether the excess of earnings over outlay of a municipal undertaking like the one under consideration here was profit or not, the Appellate Tribunal relied on the circumstances stated below for its finding that the excess was really profit: