NATIONAL IRON AND STEEL CO. LTD. versus THEIR WORKMEN

Citation: [1963] 3 S.C.R. 660 · Decided: 21-08-1962 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR · Disposal: Case Partly allowed

Judgment (excerpt)

1962 
; 
660 
SUPREME COURT REPORTS (1963) 
NATIONAL IRON AND STEEL CO. LTD. 
v. 
THEIR WORKMEN 
(I". B. GAJENDRAGADKAR, K. C. DAs GUPTA and 
. 
J. R. MUDHOLKAR, JJ.) 
\. 
Inrluatrial Diapu~Inctnlivo bonu•-Sch.,•o-Tribunal'• 
juri•diction to mrg-Piect-f"ate workmen-Rate. 
The appellant runs a steel mill and there arc various 
departments in the mill which arc grouped under three 
headings. By agreement between the management. and the 
workmen different production targets and different incentive 
bonus schemes for different departments have been in force 
for some time. The respondent No. 2 on behalf of the work-
men claimed that incentive bonus scheme at present in force 
should be revised so as to cover those catagories of workmen 
who arc at present out of it. It was further claimed that the 
present targets of production should be refixed and brought 
to the 1948 level. On the failure of the parties to come to 
a settlement the Government referred the matter to the Indus-
trial Tribunal for adjudication. 
. 
. 
The Tribunal by its award directed the revision of 
production targets in certain departments. With regard to 
the claim for extension of the scheme to the clerical and Watch 
and Ward Staff and the workmen in the shopping depart-
ment the Tribunal awarded the exlension at certain specified 
rates. The claim for revision of the rates of bonus in the 
indirect productive department was rejected. Tho Tribunal 
also rejected the claim of the workmen that the rate• of 
'production bonus to all catagories of workmen should be made 
uniform. 
The appellants thereupon appealed to this Court by way 
of special leave. The main question raised in the appeal was 
whether the Tribunal had jurisdiction to refix the production 
targets as well as the rates of incentive bonus. A further 
question raised .was whether piece-rate workmen are entitled 
to incen.tive bonus. The appellants made a grievance of the 
fact that their request to appoint assessors for giving opinion 
on technical matters was rejected by the Tribunal. They 
also alleged that the Tribunal had no adequate data before 
it to determine the proper production targets. 
\ 
) 
3 S.C.R. 
SUPREME COURT REPORTS 
661 
Hela;, that the Tribunal ought to have borne in mind · 
the fact that for the determination of technical matten it is 
alway& desiral:ile to have the assistimce of persons who are 
familiar with the subject and it should not deny to itself the 
opportunity of obtaining the, appropriate material. While 
it is the function of the management whe.ther or not to intro. 
duce a scheme of incentive bonus, once such a scheme is 
introduced the Industrial Tribunal has jurisdiction to vary 
the scheme including the rates of bonus. But the scheme 
should not be interfered with lightly. The Tribunal is entitled 
to consider whether the scheme is 
erroneou~, unrealistic or 
unreasonable. Where after consideration or relevant materials 
the Tribunal finds the targets are too high it can refix them. 
But it should also see that the targets fixed are not too low. 
Hela;, also, that piece·rate workmen are entitled to be 
paid at a higher rate . for the excen they have produced 
beyond a norm. But in fixing the higher rate care should be 
taken to avoid glaring disparity between the total earnings of 
an average piece-rate worker and of a time-rate workman 
working over the same period. 
Crvn. APPELLATE JuRISDIOTION: Civil Appeal 
No. 208 of 1962. 
Appeal by special leave from the award dated 
·" 
August 19, 1960, of the Third Industrial Tribunal, 
West Bengal, in Case No. VIII-119 of 1958. 
A. V. Viswanatha Sastri, S. K. Bose and Sardar 
Bahadur, for the appellant. 
D. N. Mukherjee, for respondent No. I. 
.._; 
Janardan Sharma and B. P. Mahe.ahwari, for 
respondent No. 2. 
· 1962. August 21. The following Judgment 
of the Court was delivered by. 
MuDHOLKAR, J.-The substantial question 
, which falls for decision in this appeal by special 
-, leave a~ainst an award made by the Third Indus-
trial Tribunal. West Bengal, centres round the 
1912 
Nalional Iron and 
Steel C1. Lit/. 
v. 
The,ir w,,kme • 
Mudholkar J. 
196B 
National Iron and 
Steel Co Ltd • 
.. 
Tf.eir IVorkmen 
M udholkar J. 
662 
SUPREME COURT OOPORTS (1963] 
question of production bonus. The appel11tnt comp-
any Tuns a steel mill at Belur. There a.re various 
departments in the mill which have been grouped 
under three headings: direct productive departme-
nts, indirect productive · departments and non-

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