AIR 1963 SUPREME COURT 474 ::1962 4 FacLR 400 ::1962 (1) LabLJ 405 ::1962-63 22 FJR 185 ::1964 (1) SCJ 112

Supreme Court Of India

(From Third industrial Tribunal, West Bengal)*

Hon'ble Judge(s): P. B. Gajendragadkar, Ajit Kumar Sarkar, K. N. Wanchoo , JJJ

(A) Industrial Dispute - Bonus - Calculation - Interest on paid up capital - Except in exceptional circumstances six percent to be allowed.Decision of third Industrial Tribunal, West Bengal, in case No. VII-153 of 1959, Reversed. The return on paid up capital provided in the Full Bench formula is not linked with actual dividends that might be declared by a company. Many a time companies declare dividends higher than six per centum. But under the Full Bench formula they are usually allowed six per centum interest on paid up capital irrespective of the dividends declared. It is only where company can make out an exceptional case for allowing more than six per centum interest on paid up capital that the tribunal can award more. Similarly it is only when an exceptional Case is made out for allowing less than six her centum interest that the tribunal would be justified in allowing less. The fact that a company declares a dividend at more or less than six per centum is no reason for changing the rate of interest allowed under the Full Bench formula on Laid up capital. (B) Industrial Dispute - Customary bonus-Is always connected with some festive-Closing bonus held not connected with any custom.AIR 1959 SC 1151, and AIR 1960 SC 886, Rel on. (Para 6) ....