Case: Workmen Vs. Management Of Dunlop Rubber Company Of India Limited

paid nearly 60 to 62% as bonus. Prima facie, we are of the view that even if the claim of the company for rehabilitation is rejected completely, still on the basis of the figures worked out in the above charts, after taking into account the rebate in Income-tax that will be received by the company, the workmen have been paid bonus at a rate which has been accepted as correct by this Court and as such they cannot have any grievance.18. Regarding the claim for rehabilitation, the company had filed three statements. Exts. M-15, M-16 and M-17 are charts relating to the buildings, plant and machinery and moulds. The company has also adduced evidence in respect of the claims made in these statements. Mr. Ramamurthi has attacked the claim for rehabilitation made by the company. When the charts prepared by the management regarding rehabilitation were before the Tribunal, we find that several matters spoken to by the witnesses regarding the charts do not appear to have been seriously challenged by the workmen. Regarding the multipliers and divisor for plant and machinery, including moulds, these have been spoken to by the factory Engineer, MW-3. Regarding the buildings, the Architect, MW-4, has also given evidence. Regarding all these matters, the Chartered Accountant attached to the auditors of the respondent company, has given evidence as MW-2. The appellant has not objected to the data adduced as well as the documents produced by the company. No suggestions have been made to these witnesses that the figures on the basis of which the rehabilitation claim was made, were in any way erroneous. It is before us for the first time that Mr. Ramamurthi has urged that the evidence of these witnesses is not sufficient to justify the claim for rehabilitation made by the company. Mr. Ramamurthi has referred us to the various decisions regarding the nature of the evidence that is required to be produced by a company when it makes a claim for rehabilitation. Mr. B. Sen invited our attention to the award dated February 5, 1960 of the Industrial Tribunal, Calcutta, Ext. M-26, which related to the claim of the workmen of the respondent company in Calcutta for bonus for the year 1957. In that award, the Tribunal has very elaborately gone into the evidence adduced by the company and has allowed a sum of Rupees 2,18,36,983, as calculated by the company, as rehabilitation charges. When once a Tribunal has considered a similar claim and has adopted on the basis of the evidence adduced by the parties, normally the amount awarded towards rehabilitation claim should be adopted. We do not say that it is conclusive. But that award is certainly entitled to due consideration at our hands. In that award the Tribunal has worked out the rehabilitation claim for the year 1957. The charts filed by the company regarding rehabilitation, though for the years 1962 and 1963, were worked out only on the basis of the replacement cost of the year 1958. We are mentioning this aspect because if the appellants case was that the Tribunal, when working out the claim for 1957 in Ext. M-26, has not properly appreciated evidence, it should have elicited from the witnesses, who deposed on behalf of the company, that the figures furnished by them are not correct and cannot be accepted. No such attempt has been made by the. appellant. Mr. Sen, learned counsel, relied on the decision of this Court in M/s. Hindustan Motors Ltd. case (1968) 2 SCR 311 = (AIR 1968 SC 963 ) and pointed out that according to that amount decision, the only permissible deduction from the total amount claimed as required for rehabilitation by the appellant can be the depreciation amounting to Rs. 5.17 crores and Rupees 5.75 crores in 1962 and 1963 respectively. He further pointed out that if the amount representing depreciation reserved is taken out of the total reserves, which is established by the evidence, then the balance has been utilised in raw material and hence there were no available liquid assets towards rehabilitation.19. We do not propose to go into the details of the claim for rehabilitation made by the respondent-company, as well as the objections now made on behalf of the workmen to the said claim. The reason is that when evidence, oral and documentary, was adduced by the company before the Tribunal, the appellant has not objected to the data adduced and the documents produced by the management and they have not put any questions to the witnesses to establish that the calculation made by the company is erroneous. There is also the additional fact that from two charts of available surplus for the years 1962 and 1963, reproduced earlier, even without allowing any claim far rehabilitation, the workmen have been paid bonus for the two years in question at rates higher than 60 %. Allowing for the benefit that the management will get by way of tax rebate on the amount of bonus paid, the payment of bonus already made is in accordance with the proportion accepted by this Court vice M/s. Gannon Dunkerley and Co. Ltd. v. Workmen, AIR 1971 SC 2567 . Even on the basis of the calculation to be made, according to the appellant, in respect of the rehabilitation claim, the company will be entitled to some amount at least in that regard. Even if the amount, as contended by Mr. Ramamurthi, is taken into account, the available surplus, as shown in the charts, will be reduced further. The result will be that even the amount paid as bonus already by the company, will be more than what the workmen will be entitled to according to the decisions of this Court. As pointed out earlier, even without making any provision for rehabilitation, the percentage of bonus paid is amply sufficient. Considering the matter from any point of view, there is no question of the workmen being entitled to any additional bonus over and above what has already been paid.20.

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

Explanation:
1[ds]We are of the opinion that the Tribunal was justified in accepting the contention of the company that the amounts received as commission and royalties need not he added back.It may be mentioned that the company had deducted from the profits the provision made for retirement gratuities written back. Mr. Sen has quite fairly accepted that the deduction is not justified. Therefore, this item need not be discusseddonations were claimed as deduction in 1963. As a substantial part of the donations was for the National Defence Fund, the Tribunal held that the expenditure was properly incurred and the company was justified in deducting the donations from the profits.Sen accepted that the deduction made by the management under this head is not justified. Even otherwise, the company is not entitled to deduct those amounts, as is clear from the decision of this Court in Voltas Ltd. v. Its Workmen, 1961 (3) SCR 167   = (AIR 1961 SCboth these decisions, the nature of the evidence to sustain a claim for return on working capital has been discussed and laid down. In particular, in the second decision cited above, the various decisions bearing on the point have been exhaustively reviewed. The position emerging from the decisions of this Court is that mere production of aby a company cannot be taken as proof of a claim as to what portion of the reserves has been actually used as working capital. The utilization of any amount from the reserves as working capital has to be proved by an employer by adducing proper evidence by way of affidavit or otherwise, after giving an opportunity to the workmen to contest the correctness of the same inThe company will have to satisfactorily prove that the amount on which return is claimed has been actually used as workingcompany has filed Ext.containing particulars regarding the amount used as working capital for the years 1962 and 1963. It has also filed Ext.the certificate of the Chartered Accountant, that reserves of Rs. 5,83,75,228 and Rs. 6,22,64,083 have been used as working capital in the years 1962 and l963 respectively. MWl has spoken to the contents of Exts.9. The Chartered Accountant of the auditors, who issued the certificate, Ext.has also given evidence asWhen they have spoken about the amounts used as working capital, there is absolutely noby the union regarding these matters. This is not a case where merely the profit and loss account alone has been filed without any further evidence adduced by the management. Mr. Ramamurthi no doubt attempted to satisfy us by a reference to the profit and loss account for the two years that the entire amount claimed by the company could not have been used as working capital. We have gone through the balance sheet and profit and loss account. We are satisfied that the Tribunal has rightly accepted the claim of the management for 4% return on the workingare not inclined to accept this plea of Mr. Ramamurthi. On the other hand, Ext.shows that the company was prepared to take a stand that even without any claim for rehabilitation being allowed in its favour, the available surplus shown in Ext.will establish that the workmen have been paid more than 60 to 62 % of the available surplus as bonus for each of the two years. Ext.does not and cannot be put against the company if it can properly establish a claim for rehabilitation. Before we discuss further the claim for rehabilitation, it is now necessary to work out the figures on the basis of the findings recorded by us earlier. We have accepted the claim for deduction of commission and royalties in favour of the company. We have also accepted its claim for return on the share premium amount of Rupees 70 lakhs. We have disallowed the claim of the company regarding the amount paid by them as donation in 1962. We have allowed the companys claim for return on the working capital on the above basis, two chart have been prepared of the available surplus for the years 1962 and 1963.We do not propose to go into the details of the claim for rehabilitation made by theas well as the objections now made on behalf of the workmen to the said claim. The reason is that when evidence, oral and documentary, was adduced by the company before the Tribunal, the appellant has not objected to the data adduced and the documents produced by the management and they have not put any questions to the witnesses to establish that the calculation made by the company is erroneous. There is also the additional fact that from two charts of available surplus for the years 1962 and 1963, reproduced earlier, even without allowing any claim far rehabilitation, the workmen have been paid bonus for the two years in question at rates higher than 60 %. Allowing for the benefit that the management will get by way of tax rebate on the amount of bonus paid, the payment of bonus already made is in accordance with the proportion accepted by this Court vice M/s. Gannon Dunkerley and Co. Ltd. v. Workmen, AIR 1971 SC 2567  . Even on the basis of the calculation to be made, according to the appellant, in respect of the rehabilitation claim, the company will be entitled to some amount at least in that regard. Even if the amount, as contended by Mr. Ramamurthi, is taken into account, the available surplus, as shown in the charts, will be reduced further. The result will be that even the amount paid as bonus already by the company, will be more than what the workmen will be entitled to according to the decisions of this Court. As pointed out earlier, even without making any provision for rehabilitation, the percentage of bonus paid is amply sufficient. Considering the matter from any point of view, there is no question of the workmen being entitled to any additional bonus over and above what has already been paid.