M/S. Burn & Co. Ltd. & Ors Vs.
Their Employees  INSC 59 (30 March 1960)
GUPTA, K.C. DAS
CITATION: 1960 AIR 896 1960 SCR (3) 423
CITATOR INFO :
F 1963 SC 325 (20,21,22) F 1964 SC 472 (3) RF
1972 SC2148 (22) RF 1975 SC1114 (3)
bonus--Scheme--Exclusion of clerical and subordinate staff--Propriety--Power of
There can be no doubt from the point of view
of Economics that the clerical and subordinate staff of an industry like its
manual workers contribute to its production and there can, therefore, be no
reason for excluding them wholly from the benefits of a scheme of incentive
bonus. The fact that the clerical staff are paid dearness allowance at a higher
scale can be no reason for their exclusion.
(1) 30 I.T.R. 388 424 Where, as in the
instant case, the company had already Introduced a scheme of incentive bonus
for the majority of its workmen, there could be no reason why the Industrial
Tribunal should not be able to extend that scheme to the clerical and
M/s. Titaghur Paper Mills Co. Ltd. v. Their
Workmen,  Supp. 2 S.C.R. 1012, considered.
CIVIL APPELLATE JURISDICTION: Civil Appeals
Nos. 195 and 196 of 1959.
Appeals by special leave from the Award dated
April 15, 1957, of the Third Industrial Tribunal, West Bengal, in Case No.
VIII-7 of 1956.
B. Sen, P. K. Chakravarty and B. N. Ghosh,
for the appellants (in C. A. No. 195 of 59) and respondents (in C. A. No. 196
N. C. Chatterjee, D. L. Sen Gupta and B. P.
Maheshwari, for the respondents (in C. A. No. 195 of 59) and appellants (in C.
A. No. 196 of 59).
1960. March 30. The Judgment of the Court was
delivered by WANCHOO, J.-These are two appeals by special leave against the
same award of the Third Industrial Tribunal, West Bengal and shall be disposed
of by this judgment. Appeal No. 195 is by Messrs. Burn and Co. Limited
(hereinafter called the company) and Appeal No. 196 is by the workmen of
Burn and Co. Limited (hereinafter called the
There were disputes between the company and
the workmen on various matters, which were referred to the tribunal for
adjudication. Of these disputes, only two now survive in the two appeals. The
company's appeal is with respect to that part of the award which deals with
incentive bonus to the clerical and subordinate staff while the workmen's
appeal is with respect to that part of the award which appeals with the cash
benefit of Annas eight per head per working day for the period the canteen was
not in operation.
We shall first take up the company's appeal.
The company has introduced incentive bonus for manual workers including Sarkars
and Checkers but there is no provision for incentive bonus to the clerical and
subordinate staff. The workmen therefore claimed that these two categories
should also be given incentive bonus like the manual workers and pointed out
425 that in other concerns this was done. The company resisted the claim on two
grounds: (i) that the clerical staff got what is known as the Bengal Chamber of
Commerce dearness allowance, which is higher than, the dearness allowance paid
to the manual workers and (ii) that the clerical staff and the subordinate
staff do not actually produce anything and if they are given incentive bonus it
will mean that they would be paid on the 'production of others, namely, the
The tribunal was of the view that the fact
that the clerks got the Bengal Chamber of Commerce dearness allowance was no
reason for their total exclusion from the benefit of the incentive bonus
scheme. It also pointed out that the subordinate staff did not get the Bengal
Chamber of Commerce dearness allowance and there was no difference between
their dearness allowance and the dearness allowance of the manual workers.
Further the tribunal was conscious of the fact that the clerical staff and the
subordinate staff do not directly produce goods but that in its opinion was no
justification for their total exclusion, particularly when other comparable
concerns like the Indian Iron and Steel Co. Ltd. at Burnpur, Bridge and Roof
Co. (India) Limited, Howrah, and Tatas were paying incentive bonus to the
clerical and subordinate staff also. It therefore ordered that the company
should extend the scheme of incentive bonus to the clerical and subordinate
staff also and lay down the rates and conditions for the same.
The main contention of the company before us
is that as the clerical staff and the subordinate staff have no part in actual
production they should not be given any incentive bonus, particularly as their
work does not increase at all because of the increased production. It is,
however, difficult to accept that there will be no increase in the work of the
clerical staff in particular and also of the subordinate staff because of
higher production, though it may be accepted that the increase may not be in
proportion to the increase of production. It is also true that the clerical
staff and the subordinate staff do not directly produce goods like manual
workers and that may be a reason 426 for treating them somewhat differently in
the matter of incentive bonus and that is what the tribunal seems to have done,
for it has directed the company to extend the scheme of incentive bonus to the
clerical and subordinate staff and to lay down the rates and conditions of the
same and has not said that exactly the same rates and conditions should apply,
to the clerical and subordinate staff as apply to the manual workers. But there
can be no doubt that economically speaking the clerical staff and the
subordinate staff also take part in the production and there is no reason
therefore for excluding them altogether from the scheme of incentive bonus.
Besides, as the tribunal has pointed out, in other comparable concerns
incentive bonus is being paid to the clerical and subordinate staff. The fact
that dearness allowance was paid to the clerical staff at a higher scale is
also, in our opinion, no reason for depriving them altogether of the benefits
of the incentive bonus scheme.
It is also urged on behalf of the company
that the introduction of incentive bonus is a management function and the
tribunal should not impose it on the management and reference in this
connection has been made to Messrs.
Titaghur Paper Mills Co. Ltd. v. Their
Workmen (1). In the present case, however, the incentive bonus scheme has
already been introduced by the company for the major part of its workmen and
all that is now asked for is that the benefit of the scheme should be extended
to the remainder of the workmen. This prayer is, in our opinion, very different
from asking a tribunal to impose an incentive bonus scheme for the first time
in a concern. We can see no reason why where an incentive bonus is in force in
a concern for the majority of its workmen, the tribunal should not be able to
extend the same to the remainder of the workmen.
We therefore see no reason to interfere with
the order of the tribunal in this behalf Turning now to the appeal of the
workmen with respect to eight annas tiffin allowance during the period the
canteen was riot working, it is enough to say that this matter was examined at
length by the (1)  SUPP. 2 S.C.R. 1012.
427 tribunal. It has dealt with the history
relating to this tiffin allowance and exhaustively considered all the points
raised on behalf of the workmen. Nothing has been brought to our notice which
would induce us to interfere with the considered order of the tribunal in this
behalf. All the points that Sri Chatterjee has raised on behalf of the workmen
have been dealt with by the tribunal and the conclusion it has reached is that
halving regard to the circumstances, the workmen were not eligible to the
tiffin allowance of annas eight per head per working day. All that we need say
is that the correspondence between the workmen and the company shows that
though the workmen were keen on the provision of a canteen before the tiffin
allowance was granted by the award dated July 24, 1953, their keenness disappeared after the award. The company seems to have taken steps even before
the award to start a canteen and pursued the matter vigorously after the award;
but the workmen started objecting to the arrangements made and some of the
objections were fantastic. It seems that having been given the tiffin allowance
they preferred to have it rather than go to the canteen. In the circumstances
we are of opinion that the conclusion of the tribunal is correct and there is
no reason for interference.
The appeals are hereby dismissed, but in the
circumstances we pass no order as to costs.