Case: Wasting House Saxby Farmer Vs. Workmen

annual replacement costs of additions from 1922 to 1959. Regarding the deduction of reserves, the management filed a calculation, Ext. G-2. Evidence on these Exhibits was also given by DW 1, who was further cross-examined on behalf of the workmen. The workmen do not appear to have adduced any further evidence after remand.8. The Tribunal, by its award dated February 13, 1967, under attack, has, as mentioned earlier, directed the appellant to pay bonus at the rate of four months wages. The main criticism levelled against the award on behalf of the appellant by its learned counsel, Mr. Malhotra, is that the Tribunal has not complied with the directions given by this Court in its order of remand dated April 12, 1965 and that the award is contrary to the materials on record. The union representing the workmen, though served, has not appeared before us.9. We have gone through the award of the Tribunal and we are satisfied that the criticism levelled by the appellant is fully justified. A major part of the award is taken up by reference to the proceedings that took place at the time when the original award was passed on July 20, 1962. The two directions given by this Court are no doubt quoted in extenso, but unfortunately full effect has not been given to those directions by the Tribunal. The evidence of DW 1 as well as the materials contained in Exhibits G and G-1 have not been at all properly considered by the Tribunal. The specific direction by this Court was that the Tribunal should make calculations on the basis that upto l954 the life of the machinery has to be taken as thirty years and thereafter at twenty years and on this basis the residuary life should be properly calculated. As this has been omitted to be done by the Tribunal in its award dated July 20, l962, the Tribunal was directed to calculate the residuary life as indicated by this Court. The Tribunal has only chosen to criticise the evidence of DW 1 and the charts, Exhibits G and G-1. Even here it has to be stated that the Tribunal has totally misunderstood the nature of the evidence given by this witness. At the earlier stage of the proceedings, a calculation Memo, Ext. E-1, had been filed. Witness, DW1, after remand deposed that most of the figures and particulars have been taken from Ext. E-1 and a recalculation has been made in Exts. G and G-1in accordance with the directions of this Court in Civil Appeal No. 152 of 1964. The Tribunal instead of attempting to find out as to how far the calculations made in Exts. G and G-1 conformed to the directions of this Court and, if not, to make itself a recalculation in accordance with the order in Civil Appeal No. 152 of 1964, has merely criticised the evidence of DW 1 on the ground that the previous calculation, Ext. E-1, has not been accepted by the Tribunal in its previous award dated July 20, 1962. In our opinion, the criticism of this witness is totally unjustified. Therefore, it is clear that the Tribunal has made no attempt to recalculate the rehabilitation amount regarding the remaining life of the machinery, which was direction No. 1 of this Court.10. Then coming to the question of deduction of reserves, the Tribunal has held that the evidence of DW 1, who is the solitary witness for the management and Ext. G-2, the fresh calculation memo filed, cannot be accepted. In this connection it refers to the various aspects, which have to be taken into account, when deciding the question of reserves used as working capital. Most of the discussion on this aspect, in our opinion, was unnecessary in view of the clear directions given by this Court in its order of remand. In the said order, it was specifically directed that the Tribunal should properly scrutinise the various charts and balance sheets filed by the management and ascertain how much of the reserves amounting to rupees sixty lakhs were actually available on June 30, 1959 for purposes of rehabilitation and were not locked up either as working capital consisting of raw materials, etc. or earmarked for specific purposes, like payment of debentures". The Tribunal, unfortunately, has not complied with this direction. Ext. G-2 and the evidence of DW 1 have been rejected merely because the witness has made some contradictory statements regarding the rehabilitation calculation in Ext. E-1. The point that has been missed by the Tribunal is that Ext. E-1 was previous to the original award dated July 20, l962. According to the appellant full particulars, details and figures were already in Ext. E-l and they have been suitably modified according to the directions of this Court. A wholesale rejection of the evidence of DW1 and Ext. G-2 in the manner done by the Tribunal is totally unjustified. The Tribunal had made no attempt to scrutinise the various charts and the balance sheets filed by the appellant and come to any conclusion of its own.11.We have pointed out that the Tribunal has committed a very serious error in not complying with the directions of this Court. The calculation of the remaining life of the machinery and the deduction of reserves for purposes of rehabilitation will involve a close scrutiny of the various charts, balance sheets and statements filed by the parties. That work has to be and should be legitimately done in the first instance only by the Tribunal concerned. The Tribunal was specifically directed to investigate on the lines indicated in the remand order but it has omitted to do so. Under those circumstances there is no other alternative but to send back the proceedings to the Tribunal. Whether the claim for bonus is allowed or negatived or even granted to a limited extent, the Tribunal will have to prepare a chart giving all the necessary particulars and figures to indicate how it has arrived at such a finding.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]9. We have gone through the award of the Tribunal and we are satisfied that the criticism levelled by the appellant is fully justified. A major part of the award is taken up by reference to the proceedings that took place at the time when the original award was passed on July 20, 1962. The two directions given by this Court are no doubt quoted in extenso, but unfortunately full effect has not been given to those directions by the Tribunal. The evidence of DW 1 as well as the materials contained in Exhibits G andhave not been at all properly considered by the Tribunal. The specific direction by this Court was that the Tribunal should make calculations on the basis that upto l954 the life of the machinery has to be taken as thirty years and thereafter at twenty years and on this basis the residuary life should be properly calculated. As this has been omitted to be done by the Tribunal in its award dated July 20, l962, the Tribunal was directed to calculate the residuary life as indicated by this Court. The Tribunal has only chosen to criticise the evidence of DW 1 and the charts, Exhibits G andEven here it has to be stated that the Tribunal has totally misunderstood the nature of the evidence given by this witness. At the earlier stage of the proceedings, a calculation Memo, Ext.had been filed. Witness, DW1, after remand deposed that most of the figures and particulars have been taken from Ext.and a recalculation has been made in Exts. G andaccordance with the directions of this Court in Civil Appeal No. 152 of 1964. The Tribunal instead of attempting to find out as to how far the calculations made in Exts. G andconformed to the directions of this Court and, if not, to make itself a recalculation in accordance with the order in Civil Appeal No. 152 of 1964, has merely criticised the evidence of DW 1 on the ground that the previous calculation, Ext.has not been accepted by the Tribunal in its previous award dated July 20, 1962. In our opinion, the criticism of this witness is totally unjustified. Therefore, it is clear that the Tribunal has made no attempt to recalculate the rehabilitation amount regarding the remaining life of the machinery, which was direction No. 1 of this Court.10. Then coming to the question of deduction of reserves, the Tribunal has held that the evidence of DW 1, who is the solitary witness for the management and Ext.the fresh calculation memo filed, cannot be accepted. In this connection it refers to the various aspects, which have to be taken into account, when deciding the question of reserves used as working capital. Most of the discussion on this aspect, in our opinion, was unnecessary in view of the clear directions given by this Court in its order of remand. In the said order, it was specifically directed that the Tribunal should properly scrutinise the various charts and balance sheets filed by the management and ascertain how much of the reserves amounting to rupees sixty lakhs were actually available on June 30, 1959 for purposes of rehabilitation and were not locked up either as working capital consisting of raw materials, etc. or earmarked for specific purposes, like payment of debentures". The Tribunal, unfortunately, has not complied with this direction. Ext.and the evidence of DW 1 have been rejected merely because the witness has made some contradictory statements regarding the rehabilitation calculation in Ext.The point that has been missed by the Tribunal is that Ext.was previous to the original award dated July 20, l962. According to the appellant full particulars, details and figures were already in Ext.and they have been suitably modified according to the directions of this Court. A wholesale rejection of the evidence of DW1 and Ext.in the manner done by the Tribunal is totally unjustified. The Tribunal had made no attempt to scrutinise the various charts and the balance sheets filed by the appellant and come to any conclusion of its own.11.We have pointed out that the Tribunal has committed a very serious error in not complying with the directions of this Court. The calculation of the remaining life of the machinery and the deduction of reserves for purposes of rehabilitation will involve a close scrutiny of the various charts, balance sheets and statements filed by the parties. That work has to be and should be legitimately done in the first instance only by the Tribunal concerned. The Tribunal was specifically directed to investigate on the lines indicated in the remand order but it has omitted to do so. Under those circumstances there is no other alternative but to send back the proceedings to the Tribunal. Whether the claim for bonus is allowed or negatived or even granted to a limited extent, the Tribunal will have to prepare a chart giving all the necessary particulars and figures to indicate how it has arrived at such a finding.