Bonus

Brief facts of the matter were that respondent No.1 was the nominee/beneficiary of insurance policy holder who obtained a Takaful Planfrom petitioner company (death cover Rs.38,50,000 against annual contribution of Rs.11,639; contribution period three years; membership term five years); after death of policy holder the nominee/beneficiary lodged the claim which the insurer rejected constraining her to filecomplaintbefore the Federal Insurance Ombudsman, which was allowed, directing payment (with liquidated damages); and the insurer's review and representation to the President's Secretariat were dismissed; thereafter, both sides filed writ petitions; nominee's writ petition for implementation was allowed and insurer's writ petition was dismissed, hence, the present petition for leave to appeal was filed before the Federal Constitutional Court

Held: Burden fell on the insurance company to establish fraudulent non-disclosure/concealment/misrepresentation by the person seeking to be insured through reliable and trustworthy evidence

Cause of death of the deceased was noted as natural causes and made no mention of his death being a result of drug addiction/narcotics

Hence, there was no nexus of his death having any nexus to him allegedly being a drug addict

No independent or contemporaneous documentary evidence was placed on record by the insurer company to substantiate the grounds viz. drug addiction of the deceased

Leave was refused and present petition was dismissed, in circumstances.

Which bonus becomes part of wages, position stated.

Management may pay or refuse same to any one.

Workers Union meanwhile filing complaint before Labour Court under S. 7(2) and S.O. 10-C(2) of West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 linking up distribution of bonus on occasion of Eid

Labour Court initiating criminal proceedings

5.0.10-C(4), in circumstances, held, could not be invoked and criminal proceedings initiated by Labour Court were improper and legally questionable

Appellate Tribunal in suo motu revision quashing proceedings

West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance (VI of 1968), S. 7(2) & S.O. 10-C(4)

Industrial Relations Ordinance (XXIII of 1969), S. 38(3-a).

Gratuity-Dismissal for misconduct-Demand for gratuity to dismissed workers-Dismissal for misconduct relating to misappropriation or embezzlement-Amount involved in such misconduct to be deducted and balance of gratuity admissible in terms of settlement, held, to be paid.

Bonus Bonus-Employees not entitled to any bonus unless company makes substantial profit in a particular year.

Settlement reciting that workers could raise demand for bonus provided profitability was, reflected in annual balance-sheet - Annual balance sheet indicating huge profits even after disbursement of dividend to shareholders -Demand for bonus, in circumstances, granted subject to deduction of ex gratia payments already made, during particular year.

Determination of available surplus-Principle. It is only after all the prior charges had been determined and deducted from the gross profits that the available surplus could be ascertained for payment of bonus and that when the available -surplus had been ascertained, the three parties entitled to claim shares were, namely, Labour's claim for bonus, Industry's claim for the purposes of expansion and other needs, and shareholders' claim for return on the capital invested by them. 1t would thus be - clear that the essential condition of bonus distribution is that there should be an available surplus determined after deduction of prior charges.

Balance-sheet of company-Not conclusive proof of net profit to form basis of bonus.

Deductions to be made from gross profit-Return on unpaid up capital-Depends upon circumstances of each case-Such return, however, permissible In each case-Return on unpaid-up capital exceeding net profit available-Workmen, in circumstances, held, not entitled to any bonus.

-Bonus-Demand to be decided on basis of balance-sheet of company.

S. 15 Bonus-Not payable to worker failing to complete one year's service.

Bonus Bonus-Mercantile system of accounting-Profit bonus-Bonus for calendar year 1947-Award in 1949-Year in which bonus allowable as expenditure-Indian Income-tax Act, 1922, S. 10 (2)(x), (5).

Bonus -Accounts maintained on mercantile system-Debit of amount payable as bonus under award-Actual payment in subsequent year

Whether bonus can be claimed as deduction in year of debit-Debit in pursuance of resolution of trade association

Whether creates legal liability-Right to deduction-Indian Income-tax Act, 1922, S. 10 (2) (x).

Bonus Bonus-(Profit bonus)-Not awarded due to meagre profits.

Bonus Bonus-West Pakistan Road Transport Board, treated as one unit instead of various Regional Board, for calculating profits and losses.

Bonus Bonus-Claim not dependent on amount involved-Consideration-Sufficiently large profit after deducting charges-Full Bench formula relied.

Bonus Bonus-Profit-sharing bonus not awarded due to meagre profits.

Bonus Bonus - Incentive bonus - Payment, within discretion of Management-Right of Industrial Tribunal to interfere when scheme is started by employer-Fixation of targets-Principles-Matters to be considered-Advisability of having assessors-Payment to clerical staff and to piece-rated workmen.

Bonus Bonus - Workers already paid half month's pay -No balance for profit left for further bonus - Demand dismissed-[A I R 1959 S C 967 rel.].

Bonus Bonus-Government departments-Executing works of public utility and not working as commercial organisation Demand for bonus not accepted.

Bonus Bonus-Cannot be awarded in "anticipated" profit-Company making gain Independently of workers - Workers not entitled to any bonus.

Bonus Bonus-Claimed by way of equitable claim, must be rejected if belated.

Bonus Bonus-Production bonus-Demand on basis of what was paid to workers in a sister plant owned by same Management- Worker must prove productive efficiency to be same as that in the other plant.

Bonus Bonus-Workers not entitled to, in absence of surplus Charges taxing over bonus in working out surplus-Enumerated.

Bonus Bonus-Profit-sharing bonus-Computation of available surplus profits-Full Bench Formula-Deductions from total profits Wealth tax-Computation of depreciation for tax purposes Reserves used as working capital-Capital reserves-Surplus undistributed profits of previous year-Provision for bad and doubtful debts-Tax reserves-Whether entitled to return.

Bonus Bonus-Profit-sharing bonus-Determination of surplus profits-Full Bench formula-Allowances-Rate of income-tax-Determination-Affidavit by employer admitting lower rate of tax-Not relevant.

Bonus Bonus-Determination of available surplus-Discrepancy in balance sheet and profit and loss account-Discrepancy explained by Accountant Whether Tribunal can ignore figures-duty of Tribunal to require production of evidence to substantiate explanation of discrepancy.

Bonus Bonus-Profit bonus-Nature-General claim without specifying year of claim-Not valid-Award of puja (religious festival) bonus-Principles-Award of puja bonus when claim is for profit bonus on the ground that workmen in similar concerns get puja bonus-Not valid.

Bonus Bonus-Profit-sharing bonus-Computation of available surplus of profits-Full Bench Formula-Allowances-Income-tax-Allowance on working capital-Depreciation reserves used as working capital-Allowance oil borrowed money used as working capital.

Bonus Bonus-Profit-sharing bonus-Employer engaged in more than one activity-All activities when can be treated as one unit for purposes of bonus-Tests-Business of film studio and film production-Iran be integrated-Functional integrality: [Partap Press, New Delhi v. Secretary, Delhi Press Workers' Union 1960 P L C 606 applied.]

Bonus Bonus-Production bonus-Cement Industry-Bonus payable on cement produced in excess of annual rated capacity-Dispute relating to annual rated capacity of kiln-Management proving annual capacity as 105000 tons with aid of formula-Demand based on production target of one lakh tons rejected.

Bonus Bonus-Balance-Sheet of Company showing loss-Demand rejected.

Bonus Bonus-Ex-gratia payment as gesture of good-will-Not to be paid pro rata nor to persons not in service on material date.

Bonus Bonus-Customary bonus-Tribunal awarding customary bonus not connected with festival-Validity A customary or traditional bonus unconnected with a festival cannot be awarded by an Industrial Tribunal. Therefore, where a claim for bonus is based only on custom unconnected with any pooja or festival, the award of such bonus by the Tribunal can-of be sustained and will have to be quashed when the award is question before the high court by a writ petition.

Claim for customary bonus-Whether Tribunal should also consider payment of bonus as implied term of contract.

Bonus Bonus- Profit of one whole year to be ordinarily taken' into account in determining claim for bonus-Old firm during middle of year transferring business to new company and new company taking over assets and liabilities of old firm and carrying on business with same employees and equipments- Employees can reasonably claim a share as bonus out of profit earned during six months prior to amalgamation.

Demand refused.

Bonus -Computing profit for purpose of awarding bonus- Amount spent in payment of salaries, wages and other incidental charges cannot be overlooked-Company sustaining overall loss

Workers not entitled to bonus.