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PETITIONER: SAKHKKAR MILLS MAZDOOR SANGH

       Vs.

RESPONDENT: GWALIOR SUGAR CO. LTD.

DATE OF JUDGMENT22/02/1985

BENCH: REDDY, O. CHINNAPPA (J) BENCH: REDDY, O. CHINNAPPA (J) VENKATARAMIAH, E.S. (J) MISRA, R.B. (J)

CITATION:  1985 AIR  758            1985 SCR  (2) 958  1985 SCC  (2) 134        1985 SCALE  (1)301  CITATOR INFO :  RF         1986 SC 458  (3)

ACT:       The  Payment of  Bonus Act  1965, sections  10 and  13 seasonal’ employees-  Whether entitled to payment of minimum bonus.       Words and Phrases:      ’Working days  in any  accounting year’  - Meaning  of- Section 13 Payment of Bonus Act 1965.

HEADNOTE:      The  first   respondent.  a   Company  engaged  in  the manufacture of  Sugar, employed  workers both on a permanent basis as well as on a seasonal basis.      The employer  refused to  pay  bonus  to  the  seasonal employees  on   the  ground  that  they  were  not  employed throughout the  year, and  the  consequential  dispute  that arose between  the management  and the  appellant-union  was referred to  the Industrial  Court under  section 49  of the Madhya Pradesh Industrial Relations Act.      The Industrial  Court decided  in favour of the workers and held  that they  were entitled to payment of the minimum bonus.           The Writ Petition filed by the company was allowed and the  award of the Industrial Court was quashed. The High Court interpreted  the words "working days in any accounting year" in  section 13  of the  Payment of  Bonus Act  1965 as meaning all those days of the year except holidays, and held that the  workers were  only entitled to proportionate bonus and not the minimum bonus guaranteed under section 10 of the Act.       Allowing the Appeal of the Union to this Court, ^       HELD:  1.  In  the  case  of  a  factory  which  works seasonally during  an accounting  year, working  days in any accounting year" can only mean those days of the year during which the  employee concerned  is actually  allowed to work. Having regard  to the  scheme and  purpose of the Payment of Bonus Act  1965, the High Court was not justified in placing a different 959

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construction on  the meaning of the expression "working days in any A accounting year". [960H; 961A]           2. The judgment of the High Court is set aside and the award  of the  Industrial Court  is restored.  The bonus payable to  the employees  will carry  interest at  nine per cent per annum, from the date bonus became due until date of payment. [961B]

JUDGMENT:       CIVIL  APPELLATE JURISDICTION: Civil Appeal No. 338 of 1972.          From the Judgment and Order dated the 30th January, 1970 of  the Madhya  Pradesh  High  Court  in  Miscellaneous Petition No. 437 of 1967.       R.  K. Jain,  Pramod Dayal,  A. D.  Sangar and Ajay K. Jain for the appellant.       B.  Datta. Rishi Kesh, B. P. Singh and Ajit Puddiserry for the respondent.       H. R. Puri and C. L. Sahu for the lnterveners.       The Judgment of the Court was delivered by       CHINNAPPA  REDDY, J. The first respondent is a company engaged in  the manufacture of sugar and employing over 1100 workers, 300  of them  on a  permanent basis  and 800  on  a seasonal basis.  The permanent  employees are those employed on the clerical side and in the operation and maintenance of machines. The other 800 employees are seasonal employees who are so  employed because  the factory  itself does  not work through out the year but works during a certain season every year from  December when  the sugarcane  crop is  ready  for crushing until the crushing is over. The employer refused to pay bonus  to the seasonal employees during the year 1964-65 on the  ground that  they were  not employed through out the year. A dispute arose between the management and the Mazdoor Sangh which  was referred  to the  Industrial  Court  Madhya Pradesh, Indore  for arbitration under sec. 49 of the Madhya Pradesh  Industrial  Relations  Act.  The  Industrial  Court decided in  favour of  the workers,  but on  a writ petition filed by  the company,  the  award  of  the  arbitrator  was quashed and  it was held that the workers were only entitled to proportionate bonus and not the minimum bonus 960 guaranteed by  sec. 10  of the  Payment of  Bonus Act, 1965. This appeal  has been  filed by  the Mazdoor  Sangh under  a certificate granted by the High Court of Madhya Pradesh.       To  our minds  the question  is a  simple one  and  is capable of  only one  answer. Sections  10  and  13  of  the Payment of  Bonus Act,  as they  stood at the relevant time, were as follows:               "Section 10. PAYMENT OF MINIMUM BONUS- Subject      to the  provisions of  ss 8 and 13 every employer shall      be bound to pay to every employee in an accounting year      a minimum  bonus which  shall be  four per  cent of the      salary or  wage  earned  by  the  employee  during  the      accounting year  or forty  rupees, whichever is higher,      whether there  are profits  in the  accounting year  or      not:                  Provided that  where such  employee has not      completed fifteen  years of age at the beginning of the      accounting year,  the provisions  of this section shall      have effect  in relation to such employee as if for the      words ’forty  rupees’, the  words ’twenty  five rupees"      were substituted."              "Section 13-PROPORTIONATE REDUCTION OF BONUS IN

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    CERTAIN CASES-Where  an employee has not worked for all      the working  days in  any accounting  year, the minimum      bonus of forty rupees or, as the case may be, of twenty      five rupees,  per cent,  of his  salary or wage for the      days he  has worked  in that  accounting year  shall be      proportionately reduced."       The High Court has interpreted the words "working days in any  accounting year"  as meaning  all those  days of the year except  holidays. While  such an  interpretation may be alright in the case of a factory which works all through the year, it  would be  hardly appropriate  in  the  case  of  a factory which  works during  a particular season every year. In the  case of  a factory  which works seasonally during an accounting year,  ’ working days in any accounting year" can only mean  those days  of the year during which the employee concerned  is   actually  allowed  to  work.  That  was  the interpretation which  was placed  upon the expression by the Industrial Court and 961 we think  it is  the proper interpretation. Having regard to the   scheme and  the purpose  of the  Act, we (30 not think that the  High Court  was justified  in placing  a different construction on  the meaning of the expression "working days in any  accounting  year".  We,  therefore,  set  aside  the judgment of  the High  Court and  restore the  award of  the Industrial Court.  The bonus  payable to  the employees will carry interest  at the rate of nine per cent per annum. from the day when the bonus became due until the date of payment. The. appeal is allowed with costs. N.V.K                                        Appeal allowed. 962