J K CHEMICALS LIMITED Vs. GOVERNMENT OF MAHARASHTRA

JUDGEMENT

(1.) THE petitioner is a public limited Company registered under the provisions of The Indian Companies Act, 1913 having its registered Office at J. K. Building, Narottam - Morarjee Marg, Ballard Estate, Bombay 400 038 and a factory at Thane. The 1st respondent is the State of Maharashtra. The respondents 2 and 3 are the Trade Unions.

(2.) AT all material times, the petitioner at its factory at Thane has been engaged in manufacture and sale of Sodium Hydrosulphite and other Chemicals. For the financial year ending on 31st December, 1979, the petitioner suffered a loss of Rs. 55. 99 lacs. In the following year, the petitioner changed its accounting year from 1st January, 1980 to 30th April, 1981. For the accounting year ending on 30th April, 1981, the petitioner suffered a loss of Rs. 79. 5 lacs (after providing for depreciation of Rs. 51. 1 lakhs ).

(3.) TO provide for payment of bonus to persons employed in certain establishments on the basis of profits or on the basis of production or productivity and for matters connected therewith, The Payment of Bonus Act, 1965 (for short, the Act) was enacted. The Act applied to the petitioner, section 10 of the Act as amended with effect from 21-8-1980 provides for payment of minimum bonus by every employer to every employee. As per amended section 10, every employer is bound to pay to every employee in respect of the accounting year commencing on any day in the year 1979 and in respect of every subsequent accounting year, a minimum bonus of 8. 33 per cent of the salary or wage earned by the employee during the accounting year or one hundred rupees, whichever is higher, whether or not the employer has any allocable surplus in the accounting year. While conferring rights on the workman to get the minimum bonus without regard to whether the business of the year results in the profits or losses, the legislature has, in section 36 of the Act conferred power on the Government to exempt any establishment from liability to pay such minimum bonus, having regard to the financial position of the concerned establishment and other relevant factors so justify. As per section 36, if the appropriate Government, having regard to the financial position and other relevant circumstances of any establishment or class of establishments, is of opinion that it will not be in public interest to apply all or any of the provisions of the Act thereto, it may, by notification in the Official Gazette, exempt for such period as may be specified therein and subject to such conditions as it may think fit to impose, such establishment or class of establishments from all or any of the provisions of the Act. In other words, by providing for exemption from any or all the provisions of the Act, the legislature has cast a duty on the appropriate Government to examine the financial position and other circumstances of the establishment concerned and decide them as to whether grant or rejection of such application is in the public interest or not. Section 36 thus creates right in the parties as also duty on the part of the appropriate Government to consider the application on merits and dispose it off in accordance with the scheme of the Act. Both sections 10 and 36 are contemporaneous provisions in the Act. Thus, it is patent that the Government has the competence to exempt any establishment or class of establishments even from section 10 notwithstanding that section 10 is mandatory so far as the employers liability to the workmen and notwithstanding the said provision is an ameliorative one from the point of view of the workmen.