http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 17  

PETITIONER: MANAGEMENT OF FERTILIZER CORPORATION OFINDIA

       Vs.

RESPONDENT: THE WORKMEN

DATE OF JUDGMENT: 15/11/1968

BENCH: VAIDYIALINGAM, C.A. BENCH: VAIDYIALINGAM, C.A. BHARGAVA, VISHISHTHA

CITATION:  1970 AIR  867            1969 SCR  (2) 706  CITATOR INFO :  RF         1974 SC1967  (11)

ACT: Bonus--Ex-gratia  payments  made  in  the   past--Production bonus scheme introduced eliminating ex-gratia payment-Option given  to workmen to accept either previous or  later--Claim for    ex-gratia    payment-Strike    during    conciliation proceedings, if justified.

HEADNOTE:     For  the  first  year of production by  a  unit  of  the appellant Corporation (a Central Government Undertaking), it granted  ad  hoc bonus for  good performance to  the  unit’s employees.   For the next year, the appellant granted  bonus as  recommended by the Bonus. Commission and also  made  ex- gratia payment for good performance.  The appellant  decided to pay bonus for the third year, strictly in accordance with the Payment  of Bonus Ordinance and the Act, which had  come into force then.  The Central Minister announced in the  Lok Sabha that with the specific approval of the Central Cabinet ex-gratia  payments had been allowed in the past by  way  of bonus  to  the employees and this was  communicated  by  the Government  of  India by a letter.  In the fourth  year  the production  did  not exceed the target,  and  the  appellant offered  to  pay only the statutory bonus  under  the  Bonus Ordinance and Act ’and stated that  a production scheme  had been   introduced,  that  with  the  introduction   of   the production   bonus  scheme  all  ex-gratia   payments   were eliminated  and  that  this  scheme  was  approved  by   the Government  of India.  The workmen demanded that  the  bonus should  be paid for the third and fourth years at  the  same rate as it had been paid in previous years and the appellant was  bound to act according to the decision of the   Central Cabinet  and communicated by the letter.  The  workmen  also stated  that if their demands were not met within  15  days, they   would  be  forced  to  adopt  agitation   approaches. Conciliation  proceedings  started.  The  appellant  offered the  workmen  the  option of either  accepting  the  Cabinet decision or the production Bonus Scheme as formulated by the management.    The  workmen  desired  that   the   Cabinet’s directions be made applicable to them, declined the offer to opt  for  the production bonus, and prepared a  draft  of  a

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 17  

letter  which was intended to be sent by the workmen to  the appellant stating that the offer was also made.  The workmen went  on strike and the reference to adjudication was  made. The  Tribunal accepted the claim of the  workmen,  and  held that the strike was justified.     HELD:  (i)  The  appellant  failed  to  establish   that production bonus scheme was introduced with the consent  and approval  of  the   Central  Government  and  that  on   its introduction   the   ex-gratia  payment   of   bonus   stood eliminated.     The evidence established that the Cabinet’s decision was made known to the workmen, who were given the option  either to  accept  the  Cabinet decision or  the  production  bonus scheme  as  formulated  by the ’appellant. So  long  as  the Cabinet decision had been communicated and option was  given to  the  workmen,  it  did not  matter  at  what  stage  the communication  was  made to the labour.  The fact  that  the communication of the 707 Cabinet  decision  after the submission of  the  charter  of demands was of no consequence.     The  striking down of s. 34(2) of the Bonus Act by  this Court  has  no  bearing in considering  the  claim  of  the. respondent  in this case. When once it was  established,  as this  case,  that the Cabinet decision  regarding  ex-gratia payment  of bonus had been communicated to the workmen  with an  option  to accept the said decision  or  the  production bonus  scheme and the labour wanted the Cabinet decision  to be  implemented,  it followed that an  agreement,  under  s. 34(3)  of  the said’ Act had come  into effect  and  it  was valid. [720]     Therefore,  the  workmen  were  entitled  to   ex-gratia payment of bonus as in the previous years.     (ii) The management was prepared to pay at all times the bonus  as  per the Bonus Act.  They had also  announced  the introduction   of  the production bonus scheme.   They  were actively  taking  part  in  the   conciliation  proceedings. The  appellant also made to the Union  certain proposals  at the conference which ’proposals’ the representatives of  the workmen  promised  to discuss with the workmen  and  give  a reply  to the appellant.  But, at a meeting of  the  workmen next day, they were incited to go on strike.  The receipt of the  telegram sent by the Labour Commissioner fixing a  date for  further  discussions  and inviting the  Union  and  the management to attend the meeting, was falsely denied by  the Union. The receipt of a telegram from a person  representing the workmen at conciliation meeting, requesting the Union to put  off  going  on strike by one day was  admitted  by  the President  of the Union, but that request was  not  complied with  by  the  workmen.   All  these  circumstances  clearly established that the demand of the Union regarding ex-gratia bonus  could  not  be considered to be of  an  ’urgent  ’and serious nature’.  They also showed that the launching of the strike was unjustified. [725 H]     Therefore,  the workmen were not entitled to  any  wages for the period of strike.

JUDGMENT: CIVIL APPELLATE JURISDICTION:  Civil Appeal No. 131 of 1968.     Appeal by special leave from the Award dated December 8, 1967 of the Industrial Tribunal, Punjab in Reference No.  44 of 1966.     H.R.  Gokhale,  Anand Parkash,  J.B.  Dadachanji,   K.P.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 17  

Bhandare and Bhuvnesh Kumari, for the appellant.     A.  K. Sen, Rameshwar Nath and Mahinder Narain, for  the respondents. The Judgment of the Court was delivered by Vaidialingam, J.  This appeal, by special leave, is directed against the award dated November 24, 1967 of the  Industrial Tribunal, Punjab, Chandigarh, in Reference No. 44 of 1966.     The President of India, by order dated October 31,  1966 referred  the  following issues for  adjudication  under  s. 10(1)(d)  of  the  Industrial  Disputes  Act,  1947  to  the Industrial Tribunal, Punjab, Chandigarh: 708                      "1.  Whether the workmen are  justified               in demanding the minimum bonus payable for the               years 1964-65, 1965-66 and future years  being               fixed @ Rs. 110/- and the maximum @ Rs.  360/-               per worker ? If so, with what details ?                      2. Whether the action of the management               in treating 4 days advance bonus paid for  the               year 1965-66 as deductible from bonus  payable               in future years is justified?  If so, are  any               conditions or stipulations necessary and if so               with what details ?                      3.  Whether there is any  justification               for  making any amendments in  the  production               bonus-scheme  introduced by the management  in               such a way that it enables payment of bonus to               the  lower  paid workers at higher  rates  and               higher  paid workers at lower rates ?  If  so,               with what details ?                      4. Whether the workers are entitled  to               any  wages or compensation for the  period  of               strike  viz.,  12th October to  31st  October,               1966." It  may  be  stated at the outset that  this  Court  is  not concerned with issue No. 3.  The question of introduction of production  bonus scheme arises only to a limited extent  in so far as it has got a bearing on a contention raised by the appellant   that  the  production  bonus  scheme  has   been introduced  in  substitution of ex-gratia payment  of  bonus which was being made by the management.  Even as regards the strike period mentioned in issue no. 4, parties were  agreed before the Tribunal that the period of strike in respect  of which wages or compensation were claimed by the workmen  was from  17th  October to 31st October 1966 and not  from  12th October as stated in the issue.     The  circumstances under which the Reference came to  be made by the President of India may be stated.  The appellant Fertiliser  Corporation  of  India  is  a  limited   company incorporated under the Companies Act, 1956 and it is also  a Government  company, as defined in s. 617 of that Act.   The Nangal  unit of the appellant went into production  for  the first  time during the financial year 1962-63.   On  October 29,  1963,  the appellant issued a  Circular  regarding  the grant  of  ad hoc bonus for the year 1962-63.   The  General Manager  states,  in this Circular that the  management  has sanctioned  payment of ad hoc bonus to employees  of  Nangal unit  for good performance during the year 1962-63 and  that bonus will be payable to all employees who are on the  rolls of the Corporation on October 30,  1963 and had completed  1 year’s service on March 31,  1963 and whose basic salary  on that date did not exceed Rs. 500/- per mensem,  The 709 Circular proceeds to state that the amount of bonus  payable will  be  1 month’s basic salary  plus  dearness  allowance,

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 17  

subject to the condition that no employee will get less than Rs. 100/- or more than Rs. 300/-.     On  December 17, 1964, the appellant issued  a  circular regarding  the gram of bonus and ex gratia payment  for  the year 1963-64.  This circular states that the management  has decided  to  sanction  bonus and ex gratia  payment  to  the employees of the Nangal unit on the basis mentioned therein. The principles laid down in this circular regarding  payment of bonus and ex gratia payment are: (1) Bonus is being  paid to  all eligible employees strictly in conformity  with  the Bonus  Commission’s  recommendations,  as  accepted  by  the Central Government, and the said bonus is the minimum  bonus payable  as  per  the  Bonus  Commission’s  recommendations, equivalent  to  4%  of the total  basic  wage  and  dearness allowance (excluding all other allowances etc.) paid  during the year 1963-64.  The employees eligible for these payments are those who draw a total basic pay and dearness  allowance up  to  Rs.  1,600 per mensem and  the  quantum  payable  to employees  drawing over Rs. 750/- of basic pay and  dearness allowance  will be limited to what they would get  if  their pay  and dearness allowance were only Rs. 750/-  per  month. (2)  An  additional  ex gratia payment to  be  made  to  all workers drawing basic pay up to Rs. 500/- per month, to  the extent that such payment, together with the bonus  indicated earlier,  is equivalent to at least one month’s full  salary (basic pay plus dearness allowance); and the total  payment, i.e.,  bonus and ex gratia, in the case of  workers  drawing basic  pay up to Rs. 500/- per month would be subject  to  a minimum  of  Rs.  100/- and maximum of Rs.  300/-.  (3)  The minimum qualifying service .for ex gratia payment will be  3 months  and  the minimum qualifying service for  payment  of bonus as per Bonus Commission’s recommendation is 30 days.     On  December  30,  1964  the  appellant  issued  another circular  stating  that the minimum limit of  Rs.  100/-  in respect of bonus and ex gratia payment for the year 1963-64, as per its circular dated December 17, 1964 is raised to Rs. 110/-  and that the enhanced amount will be paid along  with the salary for the month of December 1964.     Regarding  the  grant  of bonus for  the  year  1964-65, another  circular was issued by the appellant  on  September 27, 1965. this circular it is stated that bonus for the year 1964-65  has been decided to be paid strictly in  accordance with  legal obligations arising out of the payment of  bonus under the Payment of Bonus Ordinance, 1965 (Ordinance No.  3 of  1965)  (hereinafter  referred  to  as  the   Ordinance). According to that Ordinance, bonus 710 that  is  payable  is  the  minimum  bonus  which  will   be equivalent  to  4%  of  the total  basic  pay  and  dearness allowance  (excluding all other allowances) paid during  the year  1964-65,  or  Rs.  40/-,  whichever  is  higher.   The employees  eligible for the bonus will be those who  draw  a total basic pay and dearness allowance up to Rs. 1,600/- per month, but the quantum of bonus payable to employees drawing total  pay and dearness allowance over Rs. 750/-  per  month will  be  limited  to  what it would be  if  their  pay  and dearness allowance are only Rs. 750/- per mensem.  It may be stated  at this stage that the Ordinance was promulgated  on May 29, 1965 and the Payment of Bonus Act, 1965 (Act XXI  of 1965) (hereinafter called the Bonus Act) came into force  on September 25,  1965.     On   December  9,  1965  the  Minister  of  Labour   and Employment  made  a statement in the Lok Sabha  regarding  a decision  having  been  taken  by  the  Central  Cabinet  on December  2,  1965.  In  this  statement  the  Minister  has

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 17  

referred to the fact that with the specific approval of  the Cabinet  ex gratia payments had been allowed in the past  by way of bonus to employees drawing upto Rs. 500/- per  mensem in  some undertakings in the public sector. After  referring to the recommendations of the Bonus Commission, the Minister announced  the  decision of the Cabinet  dated  December  2, 1965.   As  the  said  decision  of  the  Cabinet  has  been circulated to the appellant, the matters referred to in  the said decision will be adverted to by us when we refer to the letter of the Government addressed to the appellant.’     On December 21, 1965 the Government of India addressed a communication  to the Chairman and Managing Director of  the appellant  company  on  the  subject  of  bonus  payable  to employees  in the public sector undertakings.  As the  claim of the labour in the case, for bonus being paid for  1964-65 and 1965-66 is substantially based upon the decision of  the Central  Cabinet dated December 2, 1965 and as according  to the appellant this communication cannot be considered to  be a  direction  or  an order, it is  desirable  to  quote,  in extenso, the said communication: No. CH/COORD/64/65 GOVERNMENT OF/INDIA MINISTRY OF PETROLEUM & CHEMICALS (Department of Chemicals) New Delhi, the 21st December 1965 To Shri Satish Chandra, Chairman & Managing Director, 711 Fertilizer Corporation of India Ltd., F-43, New Delhi South Extension, Pt. I, New Delhi. Subject  :--Bonus-payable to employees in the Public  Sector undertakings. sir     I am directed to refer to the payment of Bonus Act, 1965 (No. 21 of 1965) which provides for the payment of bonus  to persons  employed in certain establishments and  for  matter connected  therewith.  "Establishment in public  sector"  is defined  in section 2(16) of the Act.  Further,  sub-section (1)  of  section 20 lays down that    if in  any  accounting year  an  establishment  in public sector  sells  any  goods produced  or manufactured by it or renders any services,  in competition with an establishment in private sector, and the income  from such sale or services or both is not less  than twenty per cent of the gross income of the establishment  in public sector for that year, than the provisions of this Act shall apply in relation to such employment in public  sector as they apply in relation to a like establishment in private sector.   It follows that the provisions of the Act  do  not apply  to  such  of the establishments  in  private  sector. Notwithstanding  the  provisions ’of the Act,  it  has  been decided   by   Government  as  a  matter  of   policy   that noncompetitive public sector undertaking should also make ex gratia  payments  to  their employees of the  minimum  of  4 (four) per cent of annual gross earnings of the employees on the  same  lines as bonus will be payable by  public  sector undertakings falling within the provisions of the  aforesaid Act.  The benefit of six-year bonus holiday (vide section 10 of  the  Act) should be available to  noncompetitive  public sector undertakings.     2.  Government have further decided that  the  following should be the guiding principles for determining the quantum of  ex gratia payments to employees of  noncompeting  public sector undertakings:

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 17  

   (i) all non-competing public sector undertakings  should pay ex gratia to their employees amounts which they would be liable  to  pay  as bonus if they were to  fall  within  the purview of the Payment of Bonus Act;     (ii)  where  such  an undertaking  has  made  ex  gratia payment  in the past, the amount of such payment  should  be treated as absorbed in the amount determined as 712 in  (i)  above.  In other words, any claim of  employees  to payment  determined  on  the lines of the Bonus  Law  as  an addition  to payment on the scale of ex gratia  payments  in the  past,  should not be accepted.  If the past  ex  gratia payment had been higher than the amount as worked out as  in (1  ) above, the level of past ex gratia payment  should  be maintained;        (iii)  the  principle in (ii), above, shall  also  be followed   in   the   case  of   competing   public   sector undertakings; and        (iv) the applicability of (ii) and (iii) above should be  conditional  upon  the  maintenance  of  the  level   of performance of the undertaking in individual cases. It  is requested that the decisions of  Government  referred to, may be noted for guidance and necessary action. Yours faithfully,                           Sd/- Nakul Sen Secretary to  Govt. of India."     Again,  on  September  9, 1966 the  appellant  issued  a circular  regarding payment of bonus for the  year  1965-66. It is stated therein that the management has decided to  pay bonus to the employees of the Nangal unit for the year 1965- 66  and that statutory bonus equivalent to 4% of  basic  pay and dearness allowance would be paid strictly in  accordance with  the provisions of the Bonus Act, 1965.  It is  further mentioned that in addition to this bonus it has been decided to  pay production bonus at 3% of wages to  employees  whose maximum scale of pay does not exceed Rs. 1,400/- per mensem. Then  the  letter proceeds to state as to  how  exactly  the production bonus is to be calculated and paid.  The circular further  states that in addition to the statutory bonus  and production  bonus  the employees will also be paid  4  days’ wages in the form of advance production bonus to be adjusted as  and when total bonus payable to the workers  exceeds  30 days’  wages in future.  There was a note appended  to  this circular   on  the  subject  of  bonus  payments,  for   the information of workers.  That note proceeds to state that as production  for  the year 1962-63 exceeded  the  target  the management  has decided to pay ad hoc bonus equivalent to  a month’s  salary  for employees drawing up to Rs.  580/-  per month.     For the year 1963-64 the employees were entitled to  the minimum bonus of 4%, according to the recommendations of the Bonus  Commission and that amount of bonus was paid.  Though legally  the  workmen were not entitled  to  anything  more, nevertheless,   as  the  Nangal  unit  again  exceeded   the production 713 target for the year 1963-64, the management decided to  give an ex gratia payment for good performance so that the  bonus as  per  the  Bonus Commissions Report plus  the  ex  gratia payment  worked out to a month’s wage.  But during the  year 1964-65   the  production  exceeded  the  target   and   the management decided to pay, in addition to the bonus  payable under the Ordinance a performance reward equivalent to  half a   month’s  wages.   The  management  was  considering   to introduce a production bonus scheme to provide an  incentive

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 17  

for increased production.  This became necessary in view  of the  advice given by the Labour Law Officer of  the  company that  ex gratia payments should be avoided.  The  management further  states  that  production  bonus  scheme  has   been approved  by the Government of India and under  that  scheme employees  are entitled to sums varying from 3% to  3.5%  of their wages.     In the year 1965-66 the production had not exceeded  the target and the employees of Nangal unit became entitled only to the statutory bonus of 4% of their wages, under the Bonus Act  and  production bonus was not  admissible.   Ex  gratia payment  also  was ruled out in view of the  advice  of  the Labour  Officer  and  because  of the  fact  that  with  the introduction  of  production  bonus  scheme  all  ex  gratia payments stood eliminated.  But, inasmuch as the workers  in the  Nangal unit have maintained peace and  good  industrial relations, the management decided, as a  special  case,   to award  production bonus of 3%  under the  production   bonus scheme.  The note summed up the position by stating that for the  year  1965-66 the Nangal workers were eligible  to  (a) statutory  bonus at 4% of the annual wages under  the  Bonus Act; (b) production bonus at 3% of the annual wages and  (c) 4  clays’ wages in the form of advance production  bonus  to give  the  workmen a month’s wages in all, which was  to  be adjusted as and when the total bonus payable to the  workers exceeds 30 days’ wages in future.     From the circular letters dated September 27,  1965  and September  9,  1966  it will be  seen  that  the  management offered to pay only the statutory bonus under the  Ordinance and  the Bonus Act and that ex gratia payment of  bonus  has been discontinued. In particular, in the note annexed to the circular  of September 9, 1966 the management has taken  the specific  stand  that  a production bonus  scheme  has  been introduced and that the said scheme has been approved by the Government  of  India.  They also maintained that  with  the introduction  of the production bonus scheme all  ex  gratia payments are eliminated.      As the appellant did not pay bonus for the years  1964- 65 and 1965-66 at the rate at which it was paid for the year 1963-64, 714 the Union submitted a charter of demands to the appellant on August  19, 1966.  The Union demanded that bonus  should  be paid  for the years 1964-65 and 1965-66 at the same rate  as it  had been paid in previous years and that  the  appellant was  bound to act according to the decision of  the  Central Cabinet dated December 2, 1965 and communicated to it by the circular  letter of the Government of India  dated  December 21, 1965.  That is, according to the Union the minimum bonus that a worker was entitled to get was Rs. 110/-.  There were certain other demands which are not necessary to consider in this appeal. By this letter the Union also indicated that if the demands were not met within 15 days, it would be  forced to adopt agitational approaches to seek compliance with  its demands.   The  management did not comply with  this  demand regarding payment of bonus and attempts at mediation  failed and the workmen went on strike from October 17, 1966 and the reference to adjudication was made on November 2, 1966.     Before the Tribunal the workmen pressed their claim  for bonus  on the basis contained in their charter  of  demands. They   also  raised  the  plea  that  the  introduction   of production  bonus  scheme  had no effect  regarding  the  ex gratia  payment  of  bonus made by the  appellant.   As  the management  had not complied with the reasonable demands  of the labour and as it was acting in violation of the  Cabinet

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 17  

decision, the workmen were justified in going on strike from October  17, 1966 and they were entitled to full  wages  for the strike period.     The  appellant resisted the claims of the  Union.   They raised certain objections regarding the jurisdiction of  the Industrial Tribunal to entertain the suit, but that again is not  the  subject. of the present  appeal.   The  management pleaded  that the claim for bonus for the years 1964-65  and 1965-66  had  to be considered and  adjudication  made  only according  to the provisions of the Bonus Act and  that  the workmen were not entitled to claim anything beyond what  was provided  in the said Act. No legal claim could be based  on ex  gratia  payments of bonus in the previous  years.   They accepted the position that under article 110 of the Articles of  Association of the company the President of India  could issue  direction  which become binding on the  company,  but pleaded  that  no  such directive had  been  issued  by  the President. Even assuming that such direction had been issued by the President to the company, the workmen, who were third parties,  could  not seek to enforce any rights  based  upon such  directives.   The appellant Corporation  is  a  public limited  company and as such an autonomous  statutory  body. They further pleaded that the rate of bonus mentioned in the Cabinet  decision would become payable only if the level  of performance or production was properly 715 maintained and in the case of the Nangal unit the level  had not been kept up.     The management further averred that in consultation  and with  the approval of the Central Government  the  appellant introduced  the  production bonus scheme  with  effect  from 1965-66 and the said scheme replaced the previous system  of ex gratia payments, made on ad hoc basis for the initial two years of the Nangal Unit’s operation.  The production  bonus is  payable  in addition to the statutory  bonus  which  the workmen are entitled to under the Bonus Act. As the  Central Government  had approved the scheme of payment of  statutory bonus  and production bonus, in lieu of the past  system  of making ex gratia and ad hoc payments, the management pleaded that the Cabinet decision of December 2, 1965 stood modified to that extent.     Regarding the treating of the 4 days’ advance bonus paid for  the  year 1965-66 as deductible from bonus  payable  in future  years and management pleaded that in order  to  keep industrial  peace  and as the new  production  bonus  scheme substituting  the old ex gratia payment had come into  force the appellant decided to pay advance bonus of 4 days  wages. This   advance  bonus  was  specifically  stated  as   being deductible when the total bonus payable to workers in future years  exceeded 30 days.  Therefore the  management  averted that  they were entitled to adjust this advance  payment  in future years.     The management further pleaded that there was absolutely no  justification  for the workmen starting  agitation  from August  27, 1966 nor for going on strike from  October  17,’ 1966.   The conciliation proceedings started under  the  Act had not terminated and the appellant also was  participating in the conciliation proceedings and was anxious to meet  the demands  of the workmen if it was otherwise  possible.   The production  bonus  scheme  for the  year  1965-66  had  been announced on September 9, 1966. The strike was both  illegal and  unjustified and hence the workmen were not entitled  to any wages during the strike period.     The  Industrial Tribunal in its award has held that  the appellant  was  bound to comply with  the  Cabinet  decision

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 17  

dated  December  2,  1965  and communicated  to  it  by  the Government  by its Circular letter dated December 21,  1965. The  decision  of  the Central  Cabinet  had  been  publicly announced  by  the Minister concerned in the  Lok  Sabha  on December  9, 1965.  The principles laid down for  ex  gratia payments  by non-competitive public sector undertakings  had been   made   applicable  to   competitive   public   sector undertakings also.  The Tribunal held that as the  appellant was   a  competitive  public  sector  undertaking  and   the directions regarding ex gratia payments of bonus as well  as the prin- 716 ciples for determining the quantum of such payments had  all been  laid down in the Circular letter of December 21,  1965 and  the appellant was bound to implement those  directions, the  claim of the labour for such payments for the years  in question was perfectly justified.  The ex gratia payment  to be  made under the Cabinet decision was to be in  accordance with  the level of past ex gratia payments.  No  doubt  such payments  were to be made provided the level of  performance was maintained.     On  the  materials placed before it, the  Tribunal  held that the said condition was satisfied. The Tribunal rejected the claim of the appellant that production bonus scheme  was introduced  in  consultation and with the  approval  of  the Central Government and it further held that the introduction of  that  scheme was not in lieu of the ex  gratia  payments made on an ad hoc basis in the previous years.  The Tribunal has  further  held  that  as the  decision  of  the  Central Cabinet,  dated  December 2, 1965 stands and  has  not  been modified  in any way by the Government, the  management  was bound  to continue the ex gratia payments. It  further  held that  the  striking  down,  by this  Court,  of  sub-s.  (2) of s. 34 of the Bonus Act had no effect on the claim made by the  Union because the claim of the Union  was  sufficiently safeguarded by sub-s. (3) of s. 34.  Ultimately the Tribunal accepted  the  claim of the workmen for payment  of  minimum bonus for the years 1964-(35 and 1965-66 being fixed at  Rs. 110/- and regarding the maximum the Tribunal held that was a matter  of  calculation, having regard to the  wages  of  an employee; but it restricted its direction in this regard  to the  two  years  in question and  declined  to  express  any opinion regarding future years.  The Tribunal also negatived the  claim of the appellant to treat the 4 days’ bonus  paid in advance for the year 1965-66 as deductible from the bonus payable in future years.  Regarding the wages claimed by the workmen  for the period October 17 to October 31, 1966,  the Tribunal  held that the strike was both legal and  justified and it directed the management to pay the workmen half their wages for that period.     The  same stand that has been taken before the  Tribunal by the parties has been urged before us by Mr. Gokhale,  the learned  counsel for the appellant-management and  Mr.  A.K. Sen, the learned counsel for the Union.     We shall first consider the correctness of the  decision of  the  Industrial  Tribunal regarding  the  claim  of  the workmen for ex gratia payment of bonus.  We are not inclined to accept the contention of  Mr. Gokhale that the  appellant was  not bound to implement the directions contained in  the Circular  letter of the Government dated December 21,  1965, containing the Cabinet deci- 717 sion  of December 2, 1965, nor his further  contention  that the  claim  of  the  workmen  for  bonus  should  have  been adjudicated  upon exclusively as per the provisions  of  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 17  

Bonus Act without reference to the Cabinet decision. The  appellant company, registered under the Companies  Act, is  no  doubt  an autonomous unit;  but  there  are  several articles  in the Articles of Association of  the  appellant- Corporation  which give power to the President of India  and the Central Government to give directions in the working  of the  appellant.   In fact, it may not be necessary  to  deal elaborately  with this matter as the, appellant  itself,  in sub-paragraph (1) of paragraph 8 of its reply dated  January 25,   1967  filed  before  the  Industrial   Tribunal,   has categorically admitted the position that trader article  110 of the Articles of Association of the company the  President of  India can issue directives which become binding  on  the company;  but  the  stand  taken therein  is  that  no  such directive  was  ever issued by the President.   The  further stand  taken by the appellant is that the  production  bonus scheme  was introduced with the consent and approval of  the Central  Government  and that, on its introduction,  the  ex gratia payments of bonus were eliminated and, to that event, the decision of the Central Cabinet, dated December 2, 19.65 stood  modified.   Even in respect of  the  Central  Cabinet decision,  relied  on by the Union, the stand taken  by  the appellant,  in  its letter dated September 21, 1966  to  the Chief Conciliation Officer, Punjab was that the Nangal  unit had   not  30  far  received  any  instructions   from   the controlling Ministry regarding the Cabinet decision and that the  position with regard to the Cabinet decision  would  be checked up by the management with their Head Office and  the Ministry.   Therefore, it will be seen that it was  not  the case  of  the  appellant that it will not be  bound  by  the Cabinet  decision, if the decision was there as a fact.   We will only refer to articles 67 and 110 of the Articles    of Association of the appellant.  Under article 67 the Board of Directors  of the company are entitled to exercise all  such powers and to do all such acts and things as the company  is authorised to exercise and do, but subject to the provisions of  the  Act and the directives, if any, the  President  may issue from time to time as contained in article 110. Article 110 is as follows:                      "110.     Notwithstanding      anything               contained  in  any  of  these  articles,   the               President  may, from time to time, issue  such               directives  as  he may consider  necessary  in               regard  to the conduct of the business of  the               Company  or  Directors  thereof  and  in  like               manner may vary and annul any such  directive.               The  Directors shall give immediate effect  to               directives so issued." Reading  the  two articles together, the  position  is  very clear  that  the  exercise of the powers  of  the  Board  of Directors of the com 4 Sup. C1/69-13 718 pany  are,  apart from other restrictions,  subject  to  the directives,  if  any, issued by the President from  time  to time,  with  regard to the conduct of the  business  of  the company or Directors.  Any direction given by the  President may, in like manner, be varied and annulled.  The  Directors are  bound  to give immediate effect to  the  directives  so issued.     As  we are of opinion that the draft letter  of  October 14, 1966 (which is discussed later on by us) constitutes  an offer  made  by  the appellant to the  workmen  to  opt  for payment of bonus either according to the Cabinet decision or according  to  the  production  bonus  scheme,  it   becomes

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 17  

unnecessary  for us to investigate the nature of  the  power that  is  exercised either by the President or  the  Central Government when giving directions to the appellant  company, under  the Articles of Association. For the same reason  the question  as to whether the circular letter of  the  Central Government, dated December 21, 1965 is a direction or order, as  envisaged by the Articles of Association, does not  also arise for consideration.     The  decision of the Central Cabinet dated  December  2, 1965 has been announced by the Minister in the Lok Sabha  on December 9, 1965 and this decision has been communicated  to the  appellant by the concerned Ministry by Circular  letter dated  December 21, 1965.  There is no controversy  that  if the  Cabinet decision is given effect to, the claim  of  the workmen for ex gratia payment of bonus as in previous  years will  have to be accepted, unless the appellant is  able  to establish  its  plea that the production  bonus  scheme  was introduced  with  the consent and approval  of  the  Central Government  in  lieu of ex gratia payments of bonus.  As  to whether  the  appellant has succeeded in  establishing  this plea is an aspect which will be adverted to by us at a later stage.     In  this case it is not necessary to consider the  wider question  as to how far, without anything else, the  workmen would be able to lay any claim on the basis of any  decision communicated  by the Government to the appellant alone.   As pointed  out  by  Mr.  Sen, it is  clear  that  the  Central Cabinet’s  decision was made known to the workmen  who  were given  the option either to accept the Cabinet decision,  as conveyed to the appellant by the Circular letter of December 21, 1965 or the production bonus scheme as formulated by the appellant Corporation.     Mr. Sen, the learned counsel for the Union, has  invited our  attention to the draft of a letter, dated  October  14, 1966,  which was intended to be sent by the workmen  to  the appellant.  That letter, which is addressed to the appellant Corporation, states: 719                      "You  have  given  us  the  option   of               accepting either the Cabinet decision conveyed               to  you vide Department of  Chemical’s  letter               No. CH/COORD/64/65 dated 21st December   1965,               the terms of which are annexed to this letter,               or  the Production Bonus Scheme as  formulated               by the FCI Board  ....  " That  the  Circular  letter  of December  21,  1965  of  the Government  was made known to the workmen is clear from  the evidence of the appellant’s witness R.W. 7 Shri Wadehra.  He has  categorically  stated that he  joined  the  discussions between the representatives of the workmen and the  Managing Director  of the appellant corporation which took  place  at Delhi on October 15, 1966. He further states that he came to know  at  that time that on October 14,   1966,  during  the discussions  between the labour and the management at  which he  was  not  present,  the  workmen’s  representatives  had desired that the Cabinet’s directions may be made applicable to  them with regard to bonus.  This witness further  states that  the  Managing  Director  made  an  offer  during   the discussions and that offer is contained in the draft  letter dated October 14,  1966, to which we have already  referred. The  witness  further states that the  workmen  declined  to accept the offer of the management to opt for the production bonus   scheme.   His  evidence  clearly  shows   that   the management  has  communicated  to the  workmen  the  Cabinet decision,  as   conveyed  by the   Circular  letter  of  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 17  

Government  dated December 21, 1965.  This evidence  further makes  it  clear that the workmen declined to  opt  for  the production  bonus scheme, but, on the other  hand,  insisted that  bonus must be paid to them according to the  Cabinet’s decision.     Mr. Gokhale attempted to explain away the effect of  the draft letter of October 14, 1966 by urging that the  Cabinet decision  has  been communicated only after  the  Union  had submitted  its  charter of demands as early  as  August  19, 1966.  So long as the Cabinet decision has been communicated and  option  was given to the workmen, it does  not  in  our opinion  matter at what stage the communication was made  to the  labour.   Under the circumstances, it is idle  for  the management to contend either that the appellant is not bound to comply with the Cabinet decision or that the workmen  are not  entitled  to  make  any claim  on  the  basis  of  that decision.     That  leaves us with the alternative contention,  raised by   the  management,  that  production  bonus  scheme   was introduced  with  the consent and approval  of  the  Central Government  and  that  on its  introduction  the  ex  gratia payment  of  bonus stood eliminated. No doubt  this  is  the stand  that  has  been taken in the  note  attached  by  the appellant in its Circular letter dated September 9, 1966. 720 we have already adverted to that note in the earlier part of our judgment.  No materials, whatsoever, have been placed by the appellant in support of this contention.  The production bonus scheme itself does not state that it is in lieu of all other  ex gratia payments.  There is no order of  Government on  record to show that the Circular letter of December  21, 1965  has  been  modified by the Government  in  any  manner whatsoever.  The only evidence relied on by the appellant in this  connection was the statement of R.W. 7, Shri  Wadehra. He says that after a full consideration of all the  relevant factors  and in consultation and with the  approval  of  the Central   Government,    a  production  bonus   scheme   was introduced by the appellant with effect from the year  1965- 66  and  that  he was himself present at a  meeting  in  the Ministry  when  a decision was taken  that  the  Corporation might  introduce  the production bonus scheme and  that  the workmen  should be paid production bonus in addition to  the bonus payable under the Bonus Act.  He further speaks to the fact  that  production bonus scheme replaced the ad  hoc  ex gratia  bonus  made in the past years. Excepting  this  bare statement  in  the oral evidence, no order  of  the  Central Government  to  this  effect,  or  modifying  its   previous decision,  has been placed before the Tribunal. Under  those circumstances,  the  Tribunal  was  perfectly  justified  in holding  that the appellant has not established that on  the introduction of the production bonus scheme, all payments of ex gratia bonus ceased.     The  striking down of sub-s. (2) of s. 34 of  the  Bonus Act,  by this Court, has no effect, as rightly held  by  the Tribunal,  in  recognising the claim of the  workmen.   When once  it is established, as in this case. that  the  Cabinet decision   regarding   ex gratia payment of bonus  has  been communicated  to  the workmen with an option to  accept  the said decision or the production bonus scheme and the  labour wanted  the Cabinet decision to be implemented.  it  follows that  an agreement, under s. 34(3) of the said Act has  come into effect and it is valid.  Hence we are in agreement with the  views  expressed  by the Tribunal that  the  ex  gratia payments, claimed by the workmen, are saved by sub-s. (3) of s. 34 of the Bonus Act.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 17  

   There  was a feeble argument, attempted to be raised  by Mr. Gokhale, that the application of the Cabinet decision is conditional upon the maintenance of the level of performance of  the undertaking in individual cases.  The  Tribunal  has held that the level of performance of workmen, in the  years in question, has been maintained.  In this connection, among other  matters, it has referred to a statement made  in  the April-May 1966 issue of the "FCI News", a journal  published by the appellant.  This journal is issued after the year has come to an end and there is a state- 721 ment  to the effect that the Nangal Fertilizer  factory  has exceeded  the revised production targets fixed  for  Calcium Ammonium  Nitrate  (CAN)  and  Heavy  Water  and  the   said performance,  despite the serious handicap suffered  because of  the severe power cuts enforced since November 1965,  was commendable.  We are satisfied that the finding recorded  by the Tribunal, on this point, is justified.     Once  it  is  held,  as we do,  in  agreement  with  the Tribunal,  that  the appellant was bound  to  implement  the Circular of the Central Government, dated December 21, 1965, it  follows  that  the appellant was bound  to  pay  the  ex gratig, payment of bonus, as claimed by the workmen for  the years  in  question and that the appellant  is  further  not entitled to deduct the advance wages of 4 days paid for  the year 1965-66.  The decision of the Tribunal, on this  aspect is correct and is affirmed.     Before  we take up the question regarding the wages  for the  strike period, it is necessary to give a  clarification regarding an observation made by the Tribunal regarding  the production bonus scheme.  While discussing the claim of  the Union  regarding  ex  gratia payment of  bonus  as  per  the Cabinet  decision,  the  Tribunal  has  observed  .that  the production  bonus scheme introduced by the appellant  is  in addition  to  the ex gratia payment which  the  workmen  are entitled  to   We do not express any opinion  regarding  the correctness  or  otherwise  of this view  of  the  Tribunal, excepting  to  state  that  the  opinion  expressed  by  the Tribunal  was  uncalled  for and outside the  scope  of  the reference.     This leaves us with the question of the claim of  labour for  wages for the strike period from October 17 to  October 31,  1966.  The Tribunal has held that the strike  was  both legal and justified and it has awarded the workmen half  the wages  for  that  period. This finding of  the  Tribunal  is attacked  on  behalf of the appellant by Mr.  Gokhale.   The learned  counsel did not urge that the strike was  illegal., but  on the other hand he pressed before us that the  strike was  thoroughly unjustified and the finding of the  Tribunal was  contrary to the evidence on record and  also  perverse. The counsel urged that various items of evidence which  have a very vital bearing on a consideration of this question had not  been adverted to at all by the Tribunal. On  the  other hand  Mr.  Sen, learned counsel for the Union,  pointed  out that  the Union made various attempts ,for having its  claim regarding  bonus amicably  settled  with.  the   management. The    management  would   not even   agree   to   implement the directions  given by  the  Central  Government.       It was            very  evasive  in  its replies  when  pressed to  act    upon  the  Cabinet  decision. Several   mediation talks    were     held   and   conciliation   also   failed. Therefore,  under those circumstances, the workmen  honestly felt that a responsible body like the appellant was not 722 amenable  to reason and hence a sense of frustration set  in

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 14 of 17  

and  in consequence the workmen went on strike to  draw  the pointed  attention of the management to the demands made  by the Union. Under those circumstances, the counsel urged that the workmen’s going on strike was justified and the Tribunal had  also awarded only half wages for that period.   Counsel urged  that  this finding had been arrived at  on  a  proper consideration   of  the  materials  available   before   the Tribunal.     We  are  not satisfied that the  Tribunal  has  properly considered  and adverted to the relevant evidence on  record before  it came to a finding in favour of the workmen.   The Union  submitted  a charter of demands on August  19,  1966. One  of the demands related to the payment of bonus for  the years  1964-65 and 1965-66 at the same rate at which it  was paid  for the previous years. The Union has stated that  the workmen will resort to coercive measures if the demands  are not complied with within 15 days. The period of notice given should have expired on September 3, 1966.  By that time  the Conciliation  Officer had intervened and he sent  a  letter, dated  August 30, 1966 to the management and the Union  that he had taken up the dispute for the purpose of  conciliation and  requested both’ the management-and the Union to  attend the conciliation proceedings on September 14, 1966.  In  the meanwhile  the Union had started agitation on  September  3, 1966  by  starting a general hunger strike and  actually  on September 5, 1966 a 96-hour hunger strike was also  resorted to  This appears to have continued till September 12,  1966. The   appellant   announced  on  September  9,    1966   the introduction of the production bonus scheme with effect from 1965-66  and also indicating the circumstances  under  which the  ex  gratia  payment of bonus was being  made  on  prior occasions  and  as to why it was  being  discontinued.   The hunger  strike  by  Shri Ramthirtha, the  President  of  the Union,  was commenced from September 12 and  continued  till September 17, 1966.     The  conciliation proceedings which had been  posted  to September 14, 1966 could not be taken up on that day as  the Officer  was  on tour.  On September 17,  1966  the  workmen started a one hour strike in each of the shifts.  The  Chief Conciliation  Officer intervened and he fixed a meeting  for September 20, 1966. The appellant management gave a  written statement to the said officer on September 21,  1966 setting out  its stand in reply to the demand made by  the  workmen. They  referred,, in this written statement, to the  Circular issued  by  them  on  September     9,  1966  regarding  the principles  governing the payment of bonus.  The  management also   stated   that  the  Nancy  unit  had   not   received instructions  from  the Controlling Ministry  regarding  the Cabinet 723 decision and that it would check up with the Head Office and the Ministry about this matter.     Nevertheless,  on October 3,  1966,  Shri Ramthirth, the President  of the Union and his group started  an  agitation that  the  management had gone behind its  commitments.   On October  12,  1966  the  Chief  Conciliation  Officer  again visited  Nangal and had discussion with the  representatives of  the  management and the Union and  this  continued  till October  15,  1966.  Shri Wadehra, R.W. 7, speaks  to  these facts and he also states that Shri Amarnath Vidhyalankar,  a Member  of Parliament, attended the proceedings  on  October 15, 1966 on behalf of the workmen.     Shri  Wadehra, in his affidavit dated June 24, 1967  has again  stated  that the Chief Conciliation  Officer  invited representatives  of the workmen to come to Delhi to  discuss

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 15 of 17  

the  matter  with the higher authorities  of  the  appellant Corporation.   Shri Wadehra further states that  he  himself joined  the  negotiations  which took place  at  Delhi  from October  15,  1966  and  that  the  said  negotiations  were attended  by the Managing Director & Chairman on  behalf  of the appellant and Mr. Vidhyalankar attended the  proceedings along with certain other representatives of the workmen. Mr. Wadehra  further states that on the evening of  October  15, 1966 the workmen’s representatives intimated that they would discuss  the outcome of the negotiations at Delhi  with  the general  body  of the workmen at Nangal, the next  day,  and then return to Delhi and report the reaction of the  workmen regarding  the proposals discussed during the  negotiations. But, instead of keeping this promise the representatives  of workmen addressed a public meeting on the evening of October 15,   1966  and  incited the workmen  to  strike  work  from October  17, 1966.  The strike was actually  commenced  from October  17.  Mr. Wadehra also stated that a  telegram  from the  Secretary  of  the Labour  Ministry  inviting  all  the parties to attend the conciliation meeting at Chandigarh  on October 17, 1966 was received but the labour did not care to attend that meeting.     We  have  referred to some of the incidents  which  have taken  place  prior  to October 17, 1966 only  to  show  the attitude  that the labour was adopting in respect  of  their demands.   There is a further circumstance that a  telegram, dated  October  13,   1966  had  been  sent  by  the  Labour Commissioner fixing conciliation proceedings for October 17, 1966,  at  Chandigarh and a telegram was also sent  by  Shri Vidhyalankar, who was representing the workmen, to the Union President request his to stay the strike for a day.  So  far as   the  telegram  stated  to  have  been  sent   by   Shri Vidhyalankar,  the receipt of the same is admitted, but  the Union is not prepared to accept the receipt of the telegram, dated  October  13,  1966 stated to have been  sent  by  the Labour Commis- 724 sioner. We will presently show that the plea of the Union in this  regard cannot be accepted because there is  sufficient evidence  on record to show that the telegram had been  sent by  the Labour Commissioner and must have been  received  by the President of the Union.     We  have  already  referred to  the  statement  of  Shri Wadehra  about the receipt, by the management, of  the  said telegram  fixing  conciliation proceedings for  October  17, 1966.  The telegram is Exhibit RW 3/1 which is dated October 13,  1966 and sent from Chandigarh.  The telegram is sent to the  appellant  and to the Union.  The  Labour  Commissioner requests  the attendance of the parties to the  conciliation meeting on October 17, at 11 a.m.     Exhibit R.W. 14 is a letter dated October 13, 1966 sent’ by  the Labour Commissioner to the appellant and the  unions concerned, containing a copy of the telegram sent by him  on that date regarding the conciliation proceedings being fixed on  October 17, at Chandigarh and requesting the parties  to appear  before him. That the said telegram and  letter  have been  sent  is proved by the evidence of R.W. 1  who  is  an Assistant in the Labour Commissioner’s Office at  Chandigarh and  who has produced the necessary file pertaining  to  the same.  That the telegram sent by the Labour Commissioner has been delivered is also proved by R.W. 3 who has produced the delivery  sheets in respect of the telegram.   Relying  upon these circumstances, quite naturally Mr. Gokhale strenuously urged that the receipt of the telegram issued by the  Labour Commissioner  is  purposely denied by the Union  to  profess

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 16 of 17  

ignorance  about the  conciliation  proceedings being  taken up on October 17, 1966, because the Union was in no mood  to participate in those proceedings.     Mr.  Sen,  no  doubt relied upon  the  evidence  of  the workmen’s  witness No. 3, Shri Ramthirtha, President of  the Union,  that  no  telegram  was  received  from  the  Labour Commissioner  regarding  conciliation  proceedings  to  take place on October 17, 1966, but this witness himself  accepts that  the telegram sent by Mr. Vidhyalankar was received  by him.   We  are  inclined to accept  the  contention  of  Mr. Gokhale  that the denial by the Union of the receipt of  the telegram sent by the Labour Commissioner cannot be accepted.     Mr.  Gokhale,  learned  counsel,  referred  us  to   the decision  of  this Court in The Managemnt   of  Chandramalai Estate,  Erna Kulam v. its Workmen (1) and  particularly  to the following observations at p. 455: (1) [1960] 3 S.C.R. 451.  ’ 725                     "While  on  the one hand it  has  to  be               remembered  that  strike is a  legitimate  and               sometimes  unavoidable weapon in the hands  of               labour  it  is equally important  to  remember               that  indiscriminate  and hasty  use  of  this               weapon should not be encouraged.  It will  not               be right for labour to think that for any kind               of  demand  a  strike can  be  commenced  with               impunity without exhausting reasonable avenues               for  peaceful  achievement of  their  objects.               There may be cases where the demand is of such               an urgent and serious nature that it would not               be  reasonable to expect labour to  wait  till               after   asking  the  Government  to   make   a               reference.  In such cases, strike even  before               such  a  request  has been made  may  well  be               justified ." Mr.  Gokhale urged that there was absolutely no  urgency  in the  case before us because the management was  prepared  to pay  the bonus as admitted by them and the  controversy  was really regarding the additional ex gratia payment.  Further, counsel  pointed out that the Conciliation Officer  had  not made any report about conciliation having failed and in fact the  telegram  sent by the Labour Commissioner  as  late  as October   13,  1966  clearly  showed  that  he   was   still ’continuing the proceedings.  Counsel also pointed out  that after having separated from the Delhi meeting on October 15, 1966,  promising to consider the proposals put before it  by the  management and communicate the same to the  management, the  leaders of the workmen incited them to go on strike  at the  meeting held the very next day and actually the  strike itself  commenced from October 17, 1966.  No doubt Mr.  Sen, learned counsel, pointed out that there was nothing for  the management  to consider in their meeting the demands of  the workmen,  because the Cabinet decision was well  known.   He also  urged  that  the  workmen  obviously  felt  that   the management was not adopting a reasonable attitude and  hence they  resorted  to a strike, which was justified  under  the circumstances.     We  may also indicate that there is evidence, let in  by the  management,  to show that during the strike period  and even  prior  to  that, several of the  workmen  resorted  to violence  and  other acts of indecency.  Evidence  has  also been  let  in to show that the workmen continued  to  strike even after a notification, dated October 31, 1966 was issued by  the  President  of  India  prohibiting  the  strike  and requiring the workers to report for duty. We do not  propose

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 17 of 17  

to dwell on these matters, because we have only to  consider the justification or otherwise of the strike from October 17 to October 31, 1966.     The  management  was prepared to pay at  all  times  the bonus  as  per the Bonus Act.  They had  also  announced  on September 726 9,  1966  the introduction of the production  bonus  scheme. They   were  actively  taking  part  in   the   conciliation proceedings.   The appellant also made to the Union  certain proposals  on  October 15, 1966 at the  conference  held  at Delhi  which ’proposals’ the representatives of the  workmen promised to discuss with the workmen and give a reply to the appellant.  But,  on October 16, 1966, at a meeting  of  the workmen,  they were incited to go on strike. The receipt  of the telegram of October 13, 1966 of the Labour Commissioner, fixing  October  17,   1966  for  further  discussions   and inviting the Union and the management to attend the meeting, is  falsely  denied  by  the  Union.   The  receipt  of  Sri Vidhyalankar’s  telegram  requesting the Union  to  put  off going  on strike by one day is admitted by the President  of the  Union,  but that request was not complied with  by  the workmen.   Sri  Vidhyalankar,  it must  be  remembered,  was representing  the workmen in certain conciliation  meetings. All these circumstances clearly show that the demand of  the Union  regarding ex gratia bonus cannot be considered to  be of  an ’urgent and serious nature’. They also show that  the launching  of  the  strike  was  unjustified.  It  therefore follows  that the workmen are not entitled to any wages  for the period of the strike viz., from October 17  to   October 31,  1966.   To  this extent the  award  of  the  Industrial Tribunal will have to be set aside.     In the result, we set aside the award of the  Industrial Tribunal  in so far as it directs the appellant to  pay  the workmen half the wages for the strike period from October 17 to  October  31, 1966; and, to that extent,  the  appeal  is allowed.  In other respects the appeal will stand dismissed. As the appellant has failed on the substantial question,  it wilt pay the costs of the respondent-workmen. Y.P.                                       Appeal     partly allowed. 727