THE CENTRAL BANK OF INDIA versus THEIR WORKMEN

Citation: [1960] 1 S.C.R. 200 · Decided: 12-05-1959 · Supreme Court of India · Bench: SUDHI RANJAN DAS · Disposal: Case Partly allowed

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

Judgment (excerpt)

200 
SUPREME COURT REPORTS [1960(1)] 
.l959 
arriv,ing at the profits or ,gains of the appellant which 
Calcutta Company were liable to tax. Consistently enough with this 
Lta. 
attitu~e, the Revenue ought to have expressed· its 
v. 
willingness to treat only a sum of Rs. 29,392-11-9 as 
The Commission~r the actual receipt of the appellant during the account~ 
of Income-ta.-r_ 
ing year and made up the computation of the profits 
Bhagwati J. 
and gains of the appellant's business on that basis. 'l'he 
Revenue, however, did nothing of the sort and insisted 
upon having its pound of flesh, asking us to delete the 
whole of the item of Rs. 24,809 from the debit side of 
the account which it was certainly not entitled to do. 
1959 
May IZ. 
We accordingly allow the appeal, set aside the judg-
ment of the High Court and answer the referred qu~s­
tion in the affirmative. The respondent will of course 
pay the appellant's costs ~hroughout. 
Appeal allowed. 
THE CENTRAL BANK OF INDIA 
v. 
THEIR WORKMEN 
(and connected appeals) 
(S. R. DAs, C. J., JAFER IMAM, S. K. DAs, 
K. N. WANCHOO and M. HIDAYATULLAH, JJ.) 
Industrial Dispute-Bonus-Banking Companies-Bank Em-
ployees-Whether disentitled to bonus-" Remuneration" meaning of 
-Banking Companies (Amendment) Act, I956 (95 of r956), amended 
s. ro, whether retrospective-Banking Companies Act, I949, (ro 
of I949), S. IO. 
Section ro(r)(b)(ii) of the Banking Companies Act, 1949, 
provided: "No banking company shall employ any person 
whose remuneration or part of who~e remuneration takes the 
form ... of a share in the profits of the company." 
The dispute between the appellant Banks and their 
employees related, inter alia, to the question whether, the pro-
visions of the Banking Companies Act, 1949, prohibit the grant 
of bonus to bank employees. The Labour Appellate Tribunal 
took the v·iew that s. IO of the Act did not stand in the way of 
granting bonus to bank employees, because bonus according to it 
was not a share in the profits of the company. On appeal, it was 
contended for the appellant Banks that bonus as awarded by the 
Industrial Courts is remuneration within the meaning of s. IO 
S.C.R. 
SUPREME COURT REPORTS 
201 
read with s. 2 of the Banking Companies Act, 1949, and that it 
was also a share in profits, and therefore, the express provisions 
of i. 10 read with s. 2 override the provisions of the Industrial 
Disputes Act, 1947, so far as banking companies are concerned, 
and prohibit the award of bonus to employees of Banks. 
Held : (I) that the expression " shall employ any person " 
in s. 10 of the Banking Companies Act, 1949, means and includes 
" shall have in employment any person " and that in this respect 
the amendment of 1956, merely makes clear what was already 
meant by the section ; 
(2) that the word "remuneration" in s. ro of the Act has 
been used in the widest sense and includes bonus ; 
(3) that bonus in the industrial s~nse comes out of the 
available surplus of profits, and when paid, it fills the gap, 
wholly or in part, between the living wage and the actual wage. 
It is labour's share in the profits, and as it is a remuneration 
which takes the form of a share in profits, it comes within the 
mischief of s.' ro of the Act ; 
. 
(4) The Banking Companies (Amendment) Act, 1956, is not 
a declaratory Act, and except in the sn1all matter of the expres-
sion "shall continue tQ employ" in sub-s. \r), it does not pur-
port to explain :any former law or declare what the law has 
always been. Consequently, though s. 10 as amended by the Act 
of 1956 does not stand in the way of the grant of industrial 
bonus, for the period relating to the present appeals, the amended 
section had no retrospectivt ·effect. 
Accordingly, s. 10 of the Banking Act, prior to the amend-
ment of I956, prohibited the grant of industrial bonus to bank 
employees inasmuch as such bonus is remuneration which takes 
the form of a share in the profits of the banking company. 
CrviL APPELLATE JuRISDICTION: Civil Appeals Nos. 
56 to 62 of 1957. 
Appeals by special leave from the judgment and 
order dated April 28. 1954 of the Labour Appellate 
Tribunal of India (Special Bench-Banks), Bombay,in 
Appeals Nos. 122, 129, 130, 142, 144, 145, 152, 153, 
154, 155, 162, 169, 217 & 218 of 1953. 
N. A. Palkhiwala, J. B. Dadaclwnji and 8. N. 
Andley, for the appellants in C. As. Nos. 56 & 60 of 
1957. 
M. 0. Setalvad, Attorney-General for India, J. B. 
DadacluLnji and S. N. Andley, for the 

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