LexTHE BHARATKHAND TEXTILE MFG. CO. LTD. & OTHERS versus THE TEXTILE LABOUR ASSOCIATION, AHMED ABAD.
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'. - - - • 3 S.C.R. SUPREME COURT REPORTS 329 THE BHARATKHAND TEXTILE MFG. CO. LTD. & OTHERS v. THE TEXTILE LABOUR ASSOCIATION, AHMED ABAD. - (P. B. G.AJENDR.AG.ADK.AR and K. N. WANCHoo, JJ.) Industrial Dispute-Claim of gratuity by workmen in textile industry-Framing of scheme in modification of previous award- V alidity-Gratuity, if in the nature of profit bonus-Applicability of Full Bench formula-Duty of Industrial Court-Bombay Industrial Relations Act, r946 (Bom. XI of r947), s. n6A-Employees' Provi- dent Funds Act, r952 (XIX of r952), s. r7. This was an appeal by certain textile mills of Ahmedabad against a scheme for gratuity awarded by the Industrial Court. The Labour Association, the respondent, gave a notice of change under s. 42(2) of the Bombay Industrial Relations Act, 1946- (Bom. XI of l9ll7), intimating the Mill Owners' Association that they wanted a scheme for gratuity and mentioned four categories of termination of service in the annexure. This demand was refused and so referred to the Industrial Court under s. 73A of the Act. Pending the reference the Employees' Provident Funds Act, 1952 (19 of 1952), came into operation and the Industrial Court, on an objection by the Mill Owners' Association, held that it was inadvisable to proceed with the reference and that a fresh application should be made, if necessary, after the scheme envi- saged by the Act is introduced and rejected the respondent's · demand. Thereafter a fresh ·notice of change was given by the respondent and there were certain references to the Industrial , Court in respect of the demand. The parties came to an agree- ment to refer all their disputes to arbitration, the references were withdrawn and the disputes were referred to the Board of Arbitra- tors. Before the Board the Mill Owners' Association took the objection that so long as the award of the Industrial Court dismiss- ing the earlier reference subsisted, the claim for gratuity could :not be considered by it. That objection was uplield by the Board and it made no provision for gratuity. Thereupon the respon- dent applied for the modification of the award under s. n6A of the Act, and the Industrial Court by its award, which is the sub- ject matter of the present appeal, framed a.scheme for gratuity on an industry-cum-region basis: Held, that the decision of the Industrial Court was correct and must be upheld. Regard being had to the true nature of its earlier award and the scope of the application for its modification, it could not be said that the respondent was seeking to alter the framework or change any of the principles of that award and the application under s. n6A of the Act must be held to be competent. · Marek I]. z960 Bharatkhand Taxtile Mfg. Co. Ltd. v. i extile Labou1 Association • 330 SUPREME COURT REPORTS [1960] A scheme for gratuity is by its nature an integrated scheme and covers all classes of termination of service where gratuity benefit can be legitimately claimed and the refusal of the Indus- trial Court in the earlier award amounted to a refusal to frame any scheme at all. The statutory provident fund created by the Employees' Provident Funds Act, 1952, could be no bar to the respondent's claim for a gratuity scheme although there can be no doubt that in awarding such a scheme Industrial Courts must make due allowance for it. Provisions of s. 17 of the said Act clearly indi- cate that the statutory benefits under the Act are the minimum to which the employees are entitled and that they are no bar to additional benefits claimed by the employees. • Indian Hume Pipe Co. Ltd. v. Their Workmen, [1960] 2 S.C.R. 32, referred to. It was not correct to say that the claim for gratuity was essentially similar to a claim for profit bonus and must always be considered on unitwise basis. The benefit of gratuity .is in the nature of a retiral benefit and before framing such a scheme industrial adjudication has to take into account such relevant factors as the linancial condi- tion of the employer, his profit-making capacity, the profits earn- ed by him in the past, the extent of his reserves and the chances of his replenishing them as well as the claims for capital invested by him, and in evolving a long term scheme a long view of the employer's financial condition should be taken and on that basis alone the feasibility of a scheme and the extent of the benefit to be given should be determined.
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