LexTHE NEW MANECK CHOWK SPINNING AND WEAVING CO., LTD., AHMEDABAD AND OTHERS versus THE TEXTILE LABOUR ASSOCIATION, AHMEDABAD
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t i THE SUPREME COURT REPORTS THE NEW MANECK CHOWK SPINNING AND WEAVING CO., LTD., AHMEDABAD AND OTHERS v. THE TEXTILE LABOUR ASSOCIATION, AHMED ABAD (P. B. GAJENDRAGADKAR, A. K. SARKAR, K. SUBBA RAO, K. N. W ANCHOO and J. R. MUDHOLKAR, JJ.) Industrial Dispute-Profit bonus-Agreement between Labour and Mill-owners-Full Bench Formula, whether contravened by Agreement-Tribunal's competence to extend Agreement. The respondent, the Textile Labour Association at Ahmeda- bad, entered into a five years pact with the Ahmedabad Mill- Owners' Association, representing the member mills, in regard to payment of bonus to the employees of the mills for the years 1953,57. The Labour Unlon demanded bonus for the year 1958 on the basis of the pact, but the mill-owners claimed that the pact was contrary to the formula evolved by the Full Bench in Mill Owners' Association, Bombay v. The Rashtriya Mill M azdoor Sangh, Bombay, [1950] 2 L.L.J. 247, which was approved by the Supreme Court in The Associated Cement Companies Ltd. v. Its Workmen, [1959] S.C.R. 925, inasmuch as (1) rehabilitation provided in the Agreement differed vitally from rehabilitation as explained in that decision, (2) the_ Agreement provided for payment of a minimum bonus even though there may be no available surplus and even though the particular mill might have made actual loss, and (3) while the Full Bench Formula, as approved by the Supreme Court treated a particular year as a self-sullicient unit, there was provision for set-off and set-on in the Agreement. The Industrial Tribunal to which the dispute was referred in t4e form of sixty-six references, one relating to each mill, took the view that the pact did not in any· way run counter to the law. laid down by the Supreme Court, ·and that the extension of the agreement for one more year would help in promoting peace in the industry in Ahmedabad. ·· Held (Subba Rao, J'.-ditsenting), thaf the Agreement in question departed from the Full ·Bench, Formula in the. matter• of bonus,, in certain vital aspects and that the' Tribunal when it· extended the Agreement for the_.year 1958 was.ignoring the law as laid down by the Supreme Courtas to what profit boiius waa and how it should be worked out. I 1960 Decnnber 7. New Manech Chowk Spg. <!> Wvg. Co. Ltd, v. Te%tife Labour Association 2 SUPREME COURT REPORTS [1961] The Tribunal had no power by extending the Agreement to make it possible for payment of a minimum bonus for the year 1958 even when thel'I> was either insufficient available surplus to pay bonus or no available surplus at all or even actual loss. The jurisdiction of the Tribunal was limited by its terms of reference, which was not on industry-cum-region basis, but one for each mill to consider the question of bonus for each mill for the year 1958 and, consequently, it had no jurisdiction to apply the principle of set-off and set-on to be found in the Agreement in respect of payment of bonus or take into account the profits of the industry as a whole in Ahmedabad. Per Gajendragadkar, Sarkar, Wanchoo and Mudho1kar, JJ.- It is open to an industrial court in an appropriate case to impose new obligations on the parties before it or modify contracts in the interest of industrial peace or give awards which may have. the effect of extending Agreement or making new one, but this power is conditioned by the subject matter with which it is dealing and also by the existing industrial law and it would not be open to it while dealing with a particular matter before it to overlook the industrial l.a.w relating to that matter as laid down by the legislature or by the Supreme Court. Western India Automo.bile Association v. Industrial Tribunal, Bombay, [194g] F.C.R. 3i1, Rohtas Industries Limited v. Brijnan- dan Pandey, [1956] S.C.R. Boo and Patna Electricity Supply Co. v. Patna Electric Supply Workers' Union, [1959] Supp. 2 S.C.R. 761, relied on. Per Sobba Rao, J.-(r) The impugned five years pact was not contrary to industrial law as laid down by the Supreme Court. (2) The pact also did not infringe the principle that bonus depends upon profits; but it applied the same by evolving a formula of set-off and set-on to a complicated situation of the entire industry in a particular area for a number of years. (3) The Full Bench Formula in regard to rehabilitation was not con- travened by the pact. The decisions of the Supreme Court did not preclude e
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