MUMBAI KAMGAR SABHA, BOMBAY versus M/S ABDULBHAI FAIZULLABHAI & ORS.

Citation: [1976] 3 S.C.R. 591 · Decided: 10-03-1976 · Supreme Court of India · Bench: V.R. KRISHNA IYER, N.L. UNTWALIA · Disposal: Appeal(s) allowed

Cited by 5 judgment(s) · cites 4 · see the full citation network in Lexace

Judgment (excerpt)

591 
MUMBAI KAMGAR SABHA, BOMBAY 
A 
v. 
) 
M/S ABDULBHAI F AIZULLABHAI & ORS. 
March 10, 1976 
[V. R. KRISHNA !YER AND N. L. UNTWALIA, JJ.] 
B 
' 
Payn1ent of Bonus Act, 1965-Workers' Union-Not being a party to dispute 
if had locus standi-Bonus Act-If a complete code-Bonus based on custom, 
usage or a condition of service-If excluded by the Act. 
• 
• 
Res judicata-if applicable to industrial disputes. 
A considerable number of workmen were employed by a large number of 
small businessmen in a locality in the city. Prior to 1965, the employe1s 
C 
made cx-rtratia payment to the workers by way of bonus which they stopped 
from that year. 
A Board of Arbitrators appointed under s. lOA of the Industrial 
Disputes Act, to which the bonus dispute was referred, rejected the workers• 
demand for bonus. The dispute was eventually 'referred 
to 
an 
Industrial 
Tribunal which in limine dismissed the workers' demand as being barred by 
res judicata,1 in view of the decision of the Arbitration Board. 
The Tribunal' 
in addition. held that bonus so far paid having been_ founded on tradition 
and 
custom, did not fall within the four-corners of the Bonus 
Act 
which 
is a complete code and came to the conclusion that the workers were not 
D 
entitled to bonus. 
On appeal to this Court it was contended that (i) the appellant-Union not 
being a party to the dispute had no locus standi, (ii) the claim of the workmen 
not being profit-based bonus, which is what the Bonus Act deals with, the 
Act has no application to this case; and (iii) since no case of customary 
or contract bonus was urged before the Arbitration Board such a_ ground was 
barred by the general principles of res judicata. 
E 
Dismissing the appeal. 
HELD: 1 (a) In an industrial dispute the process of conflict resolution is 
informal, rough and ready and invites a liberal approach. Technically the 
union cannot be the appellant, the workmen being the real parties. 1bere is 
a terminological lapse in the cause title, but a reading of the petition, the 
description of the parties, the grounds urged and grievances aired, show that 
the battl~ was between the workers and the employers and the Union represented 
the workers. 
The substance of the matter being obvious, formal def6cts fade 
away. [596H] 
(b) Procedural prescriptions are handmaids, not mistresses of justtce and 
failure of fair play is the spirit in which Courts must view processual deviances. 
Public interest is promoted by a spacious construction of locus .standi in our 
socio-econornic circumstances, 
conceptual 
latitudinarianisn1 
permits 
taking 
liberties with individualisation of the right to invoke the higher courts where 
the remedy is shared by a considerable number, particularly when they are 
weaker. 
[597B; DJ 
Dhabolkar [1976] I S.C.R. 306 and Nawabgani Sugar Mills [1976] I S.C.C . 
120 held inapplicable. 
(e) In 
industrial 
law 
collective 
bargaining, 
union 
representation 
at 
conciliations, arbitrations, adjudications and appellate and other proceedings is 
a welcome development and an enlightened advance in industrial life. [597GJ 
In the instant case the union is an abbreviation for the totality of workmen 
involved in the dispute. The appeal is, therefore, an appeal by the workmen 
compendiously projected and impleaded through the union. [598Dl 
F 
G 
H 
592 
SUPREME COURT REPORTS 
(1976] 3 S.C.R. 
A 
2(a) The demands referred by the State Govt. under s. lO(l)(d) of the 
In~ustrial Disputes Act, specifically speak of payment of bonus by the employers 
which had become custom or usar:e or a condition of service in the establish~ 
ments. The subject matter of the dispute referred by the Govt. dealt with 
bonus based on custom or condition of service. The Tribunal was bound to 
\ 
investigate this question. The workers in their statements urged that the demand 
was not based on profits or financial results of the employer but was based on 
y' 
custom. 
[599 D-E] 
B 
(b) The pleadings, the terms of reference and the surrounding circumstances 
c 
D 
support the only conclusion_that the core of the cause of action is custom and/or 
term of service, not sounding in or conditioned by profits. The omission to 
• 
mention the name of ~ festival as a matter of pleading did not detract from the 
clain1 of customary bonus. An examination of the totality of materials leads 
to the inevitable result that what had been claimed by the workmen \vas bonus 
based on custom and service condition, not on

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