PODAR PLASTICS(P) LTD versus ITS WORKMEN

Citation: [1964] 6 S.C.R. 15 · Decided: 19-12-1963 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR · Disposal: Dismissed

Judgment (excerpt)

6 S.C.R. . SUPREME COURT REPORTS 
15 
action was in two parts and that what the father gifted was 
1963 
the money and not the property. It would be indeed an 
Kanakaral>J-
..i; artificial way of looking at the transaction as was done by 
nammal 
the trial court as being constituted of two parts. The trans- v. s. L. ~i..tudaliar· 
i 
action in my judgment is one indivisible whole, and that is, 
-
h f th 
'd d th 
f 
· · 
th 
· Mudholkar 
J •• 
t e a er prov1 e 
e money or acqumng 
e property m · 
the mother's name. 
Therefore, in effect it was the father 
who purchased the property with the intention of conferring 
the benefidal interest solely upon the mother. Such a trans-
action must therefore amount to a gift. 
In that view the 
property would not fall under cl. ( d) of s. 10 of the Act 
but under cl. (b) of that section. Therefore, the appellant 
would be the sole heir of her mother and the non-joinder of 
her brothe.Ts would not defeat the >uit so far as she is con-
cerned. In the result I would set aside the decree of the 
courts below in so far as the property in question, Beverley 
Estates, is concerned and decree the appellant's suit with 
respect to it in addition to the property with respect to which 
she has already obtained a decree in the courts below. ·I 
would further direct that the respondents will pay to the 
appellant proportionate costs in all the courts. 
ORDER BY COURT 
In accordance with the 
opinion of the majority the 
appeal is dismissed. No order as to costs. 
Appellant need 
not pay court fees 
PODAR PLASTICS(P) LTD 
v. 
ITS WORKMEN 
(P. B. GAJENDRAGADKAR AND K. c. DAS GUPTA Jl) 
Industrial 
Dispute-Bonus-Deduction according 
to Full 
Bench 
Formula-Wliat priflciple to be followed-Industrial Disputes Act, 1941 
(14 of 1947). 
An ·industrial Dispute arose between the appellant and its workmen 
in respect of the claim made by the workmen (respondents) for bonus 
for the year 1959. The respondents claimed that they were entitled IC> 
get honus equivalent to three months' salary inclu'ding dearness allow-
ance. The appellant claimed deductions on the basis of the Full Bench 
196! 
,fodar Plastics (P) 
Ltd. 
v. 
lts Workmen 
16 
SUPREME COURT REPORTS 
Formula. The appellant claimed deduction of Rs. 60.000 by way of 
notional remuneration for Mr. K. R. Podar, one of the Directors of the 
company. According to the appellant K. R. Podar devoted the whole )"' 
of his time to the supervision and management of the appellant concern. 
and so, he was entitled to charge remuneration at the rate of Rs. 5,000 
a month. 
The appellant also made a claim for rehabilitation. On these 
facts the Tribunal directed the appellant to pay to the respondents bonus 
at the rate of half month's basic wages excluding allowances and over-
time for the said year. It is against this award that the appellant has 
come to this Court. 
Held: (i) that in a _concern like the appellant's if one of the Direc-
tors spends his time in supervising 
and 
managing the affairs of the 
concern, he would be entitled to charge a reasonable rerriuneration. But 
in the present case Mr. Podar did not actually charge any remuneration. 
The working of the Full Bench Formula is no doubt notional in some 
respects, but it \Vould not be permissible for the employer to make it 
still more notional by introducing claims for prior charges on purely 
hypothetical 
and 
almost fictional basis. 
The Tribunal did 
not feel 
justified in allowing the claim for deduction made by the appellant in 
regard to the notional remuneration of Mr. POOar on the ground that 
Mr. Podar had not been paid remuneration regularly and it had not 
been duly shown in the books of account. 
Gujarat Engineering Co. v. Ahmedabad Misc. 
Industrial 
Workers' 
Union, (1961) II L.L.J. 660 and Kodaneri Estate v. Its Workmen, (1960) 
I L.L.J. 273, relied on. 
(ii) It is not the correct legal position that a second hand machinery 
should be rehabilitated only by second hand machinery. But in the 
present case the finding of the Tribunal in respect of the 
claim for 
rehabilitation is based on its appreciation of the evidence letl by the 
appellant and that cannot be disturbed having regard to the material 
which· is available on the record. 
South India Millowners' Association v. Coimbatore District Textile 
Workers' Union, (1962) I L.LJ. 223, relied on. 
_. 
(iii) It would be erroneous to assume
1 that this Court approved of or 
affirmed the ad hoc basis adopted by the Tribunal i

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