V. Kanagaraj, J.
1. The All India Tourism Development Corporation Employees' Union has filed this writ petition against the Management and the Presiding Officer, Labour Court praying to pass a writ of certiorari calling for the records on the file of the Labour Court relating to the award dated September 24, 1990 passed in I.D. No. 662 of 1984 and quash the same.
2. In the affidavit filed in support of the writ petition, the petitioner Union would submit that it is a union registered under Indian Trade Unions Act, 1926; that the duty free shop at Madras is one of the six at all India level and the same was started in 1969 that the shop is functioning as a profitable organisation; that the employees of the shop numbering 81, were paid 20 per cent bonus for several years. But for the year 1982-1983, the respondents 1 and 2 declared 8.33 per cent bonus only whereas in other duty free shops, it was 20 per cent bonus declared; that on failure of conciliation the Government on reference it was sent to the third respondent for adjudicating the quantum of bonus payable for the workmen employed at the duty free shop at Madras for the year 1982-1983 as per the G.O. Ms. No. 2523 Labour, dated November 29, 1983.
3. The further submission of the petitioner union in the writ petition is that according to the Management the duty free shop at Madras incurred a loss of Rs. 33,739.44 during 1982-1983. Further attributing the loss due to the fire accident that occurred in the godown they declared a statutory minimum bonus of 8.33 per cent. But the petitioner's case is that the godown is a common one for storing goods for all the duty free shops and the total loss could not be attributed to the Madras duty free shop alone; that further the goods stored should have been covered against the fire Insurance, and for lack of administrative capacity they have failed that the responsibility for lapse and consequent loss should have been fixed and the amount realised from them, that further the supplies covered by goods under valid Insurance against any loss and as such it is for management to continue to give coverage and hence the loss cannot be attributed to the Madras shop alone and it will be diverted to other shops in Trichy, Trivandrum, Bombay, Delhi and Calcutta. Thus, giving instances of mismanagement and carelessness in allowing the fire accident to occur and stating that the turnover during the period in question was very high when compared to the consequence with, there should have been a normal profit that the method of accounting is incomplete and irregular and illegal on the face of it, and if proper account had been done, the petitioner's claim for bonus at the rate of 20 per cent could have easily been maintained; that the Madras Unit has no independent hand to function and transactions are interlinked and connected; that excepting the sales effected in the respective unit, they were never functioning as distinct separate units; especially for determining of profit and loss for payment of bonus and sales and on such and other grounds of appeal as set out in the writ petition, the petitioner union would pray for the relief extracted supra.
4. In the counter statement filed on behalf of the respondents No. 1 and 2 besides generally denying the allegations of the writ petition, it would specifically be pleaded that the issue referred to by the Government for adjudication is (to fix the quantum of bonus payable to the workmen employed in the duty free shop at Madras for the year 1982-1983); that the India Tourism Development Corporation Limited, (hereinafter referred to as I.T.D.C.) is a company registered under the Companies Act, having the registered office at New Delhi; that it has four divisions viz., Hotels Division, Duty Free Shops Division, Travellers Lodges Division and Ashok Travels and Tours Division; that in each division number of units are functioning in various cities and towns in the country that the individual units maintain separate accounts and for each individual unit the balance sheets, profit and loss accounts as on March 31, of every year are prepared and consolidated as final accounts of the Corporation; that provision made for bonus to the employees after calculating the allocable surplus, as per the provisions of the payment of bonus Act; that one day if the allocable surplus arrived at warrants payment of bonus, it is paid in accordance with the percentage arrived at for the year in question; that there was no allocable surplus and therefore the minimum bonus of 8.33 per cent was paid as per the Act.
5. It would further be submitted on the part of the first and second respondent that the Corporation has always been trading treating the Madras unit as separate and identifiable establishment, and bonus is disbursed to the employees of each unit on the basis of the profit and loss accounts of the said unit. If there is profit the maximum 20 per cent of bonus is paid, but if the unit is run in loss, only the statutory minimum, that is 8.33 per cent is paid, and it is the uniform policy adopted and applied without any differentiation or distinction for each and every unit of I.T.D.C. that the goods are insured from the supplier's warehouse to these respondents' warehouses at destinations and as the warehouse at Madras Port Trust is a transit one, there is no necessity for extending the Insurance coverage; that on June 7, 1982 a major fire accident took place in the warehouse at Madras Port Trust wherein goods worth Rs. 60,00,000/- (Rs. Sixty Lakhs) were stored and there was massive destruction resulting in a net loss of Rs. 35,00,000; that this amount was set apart for all the four duty free shops of Delhi, Calcutta, Bombay and Madras; and out of the said amount Rs. 2.2 lakhs fell on Madras; and hence the claim of the union that inspite of the profit of Rs. 1,79,782/- for the year in question, the Management had not paid the bonus of 20 per cent is not correct. On such and other grounds the respondents 1 and 2 would ultimately pray for rejecting the claim of the petitioner.
6. During arguments, the learned counsel appearing for the petitioner laying emphasis on all the points raised in the writ petition would pray for allowing the writ petition. In reply, the learned counsel appearing for the respondents 1 and 2 would submit that the branch is always treated as separate unit. Citing the Exs. M-8, M-15 and M-17, the learned counsel would ascertain that the question of discrimination does not arise at all; that from the gross profits certain deductions are arrived at to ascertain the net profits. Citing the Ex. M-2 bonus worksheet the learned counsel would question as to what prevented the petitioner from filing the worksheet, and would further contend that M-14 is registered for maintenance of account and would say that the petitioner did not examine the accounts book with the help of auditor; that the balance sheet itself is accurate is not only in reality but also presumption as contemplated under Section 23 of Payment of Bonus Act; that absolutely there is no error and in the absence of any worksheet they cannot condemn any document. On such arguments the learned counsel would pray to dismiss the writ petition.
7. The workmen belonging to the petitioner's union are employees of all the India Tourism Development Corporation Limited which is a Central organisation, admittedly, having branches at Madras, Bombay, Calcutta, and New Delhi which has godowns and duty free shops. The godowns are for stocking the goods and at the duty free shop most of the goods are imported materials and on the part of the respondents 1 and 2 Management it is claimed that on account of the fire accident that took place in the godown at Madras Port Trust, there was a loss to the tune of Rs. 33,739.44/-which had been unforeseen and the loss is said to have been distributed centrally on all the branches and to the share of Madras Branch, it was Rs. 2.2 lakhs and hence in spite of a meagre profit made that year since bonus is paid based on the profit and loss accounts are ratio for that particular year only a statutory minimum of 8.33 per cent becomes payable.
8. The case of the petitioner's union is that even though the Management represented by the first and second respondents is a central organisation having very many branches, the Madras Unit cannot be treated as a separate union for the purpose of payment of bonus as per the provisions of the payment of bonus Act and the profit and loss accounts of each unit should get merged with the other units and in toto, the bonus of the employees that is to be paid every year should be calculated and paid. Whereas for the particular year of 1982-1983 under pretext of fire accident that took place, the members of the petitioner's union have been denied their usual payment of bonus of 20 per cent inspite of making a profit and there was no reason on the part of the first and second respondents to pay the statutory minimum bonus of 8.33 per cent, and in such event the third respondent Labour Court has erroneously arrived at the conclusion accepting the case of the Management and has justified the statutory minimum payment of bonus of 8.33 per cent which is erroneous and would pray to quash the award passed by the third respondent dated September 24, 1990 in T.D. No. 682/1984 and to pass further orders.
9. On the part of the management from the arguments advanced and the documents marked it is seen that the grounds locked at Madras is common for all the other duty free shops located at Madras, Bombay, Delhi, Calcutta, Trichy and Trivandrum and in that godown only all the goods to be distributed to the branches could be stored and the respective shops would get the release of the goods from the said godown at Madras. Likewise there is also a duty free shop at Madras which is also supplied with such materials. But each and every duty free shop located at various places is having separate balance sheets and profit and loss accounts and hence every unit is separate and independent one and it cannot be termed as centrally controlled by the Management.
10. Regarding the evidence placed on the part of the petitioner's union, one witness namely, Rajendran has been examined by the Labour Court as WW-1, and on the part of the Management also the sole witness namely Jayaram has been examined as MW-1, and regarding documents, two documents would be marked on the part of the petitioner's union as Ex. W-1 and Ex. W-2. But on the part of the Management seventeen documents, viz, Ex. M-1 to M-17 have been filed. Assessing the merit of the case through these witnesses it comes to be known from the evidence of sole Management witness that a common balance sheet or a consolidated balance sheet is being prepared for the whole of the country; that MW-13 is the consolidated statement of all the duty free shops. MW-14 is the profit and loss accounts of all the duty free shops for the year ending March 1983. Documents are also there to show each and every duty free shop preparing the profit and loss accounts. But it is the case of the Management that the bonus is being paid for the workmen in each and every unit taking into account the profit and loss accounts of that union and it is not considered preparing a consolidated statement of all the profit and loss accounts of all the unions as a whole.
11. But on the part of the petitioner's union it is insisted that taking into consideration the over all profit and loss accounts of all the unions the payment of bonus must be determined taking into account either the profit and loss that occurred in a particular unit since a particular unit regarding the place and sale of goods might be a separate entity, but not for the general administration of the Management which is one and the same for the whole country. The Labour Judge relying on certain profit and loss accounts being prepared and maintained by each and every unit separately and relying on such independent features and remarking that without connection whatever with the other units the duty free shop unit of Madras is functioning independently has arrived at the conclusion that the payment of bonus is decided based on profit and loss account of that particular unit and hence according to the loss that had occured in the year 1982-1983, the workmen became eligible only to the minimum of 8.33 per cent as it is fixed statutorily and not as claimed by the petitioner herein based on an overall consideration of the entire units throughout the country.
12. The question that is to be solved is based on whether each of the units mentioned supra, is maintaining separate accounts or accounts on balance sheets drawn separately on profit and loss accounts and based on such independent decisions arrived at by that particular unit they should pay the bonus or whether within the meaning of the relevant provisions of the payment of bonus Act, whether the payment of bonus should be determined preparing a consolidated statement of the profit and loss accounts of all the units under uniform ratio of the payment of bonus is to be arrived at is the point for determination.
13. There is no denying of the fact that respondent Corporation is a centrally based Corporation meant for the Tourism Development in the whole of the country. Its very name the Indian Tourism Development Corporation denotes that it is designed and incorporated for the purpose of promoting tourism in the whole of the country and not in segments. It is relevant to point out that there are also separate Tourism Development Corporations in each and every State which are the instrumentalities of the State Government and functioning under the guidance and directions of the respective State Governments. Hence, basically the respondent Management could be classified as an all India based Corporation meant for promotion of the Tourism Development throughout the country. It is also the evidence let in by the sole witness for the management MW-1 to the effect that the consolidated or combined balance sheet is being prepared covering all the duty free shops throughout the country. While such being the operational sphere and structure and Management of the whole affair connecting all the units of the one and the same Corporation of the first and second respondents, there is no gainsaying on the part of the third respondent Labour Judge that it is also in vogue for preparing the balance sheets on the basis of the profit and loss accounts maintained and arrived at by each unit separately and there seems to be nothing wrong in the practice of determining the structure of payment of bonus by each and every unit separately based on its own balance sheet prepared on the profit and loss accounts arrived at by each and every unit and as such since admittedly a colossal loss had occurred on account of the fire accident in the relevant period of 1982-1983 in the godown of Madras which is common for all and the loss being shared by all the units it is not proper to pay the bonus alone based on the profits and loss accounts prepared and the balance sheet arrived at by the Madras unit.
14. However, it is pertinent to note that the fire accident took place in the central godown located at Madras Port Trust which is said to be the only godown to receive and store the goods arrived and then distributed to all the duty free shops including the shop at Madras wherein the members of the petitioner union are employed and while it is the case of the Management and the loss had been distributed among all the units in which event for the unit of Madras the share of loss was arrived at Rs. 2.2 lakhs and since according to the profit and loss accounts arrived at the Madras unit of the duty free shop for that particular year no profit was shown and hence the respondents argue mat they were helpless adhering to the statutory minimum bonus of 8.33 per cent and hence the same is justifiable one.
15. It is further relevant to note that theMadras duty free shop is not managed by anysubsidiary or ancillary Management of theI.T.D.C. having its own independent existencefrom incorporation. Even on the part of theManagement it is argued that it is one of theunits of the Management the Indian TourismDevelopment Corporation having the HeadOffice at New Delhi which is still theManagement of not only Madras unit of theduty free shops but to all the segments in the country and just for the simple reason that they prepare separate balance sheets based on the profit and loss accounts that is arrived at in each and every unit, the individual units cannot be taken as independent entities having all features of an independent Corporation or firm created under the authority of law and it is only a segment having its existence, management and control being centralised and operated by the Management, i.e., The Indian Tourism Development Corporation.
16. In many a judgment analysing the true meaning of the term 'Industrial Establishments' right from the fifties, the Apex Court has ultimately arrived at the conclusion that the yardstick is not whether for some purposes, independence is seen based on its activities and sphere of operation that could be established but it is the 'Functional Integrality'' that should be ascertained in order to arrive at the conclusion that there is independent existence for each and every unit so as to call it a separate 'Industrial Establishment'.
17. In the case in hand this vital aspect of law has never been either attempted to be analysed or ascertained by the third respondent Labour Judge and without base on such legality taking some sporadic activities of preparing the balance sheet based on the profit and loss accounts arrived at by that particular unit and on such other minor activities, the Labour Judge has arrived at the conclusion regarding the determination of the payment of bonus for the relevant year in question thereby justifying the claim of the Management which is nothing but erroneous in law and the same cannot be sustained.
18. There is only one Management, i.e., India Tourism Development Corporation Limited which is having very many regional offices for transport units and duty free shops of which the Head Office is at New Delhi and the Madras duty free shop being one out of the six units at All India Level all the labour force could only be treated as the workmen of the one and the same Corporation which is expected to determine the payment of bonus that is to be paid to all its employees in a uniform manner without any distinction or discrimination based on the consolidated balance sheet prepared on the profit, and loss accounts of all the units arrived at for each and every year and thus determining the quantum of bonus that is to be paid to each and every workman of the Corporation. Just for the simple reason that the Management has been following a faulty method on all previous years, it cannot be justified in any manner saying that the same method should be allowed to continue forever. It comes to be known that even though during the relevant period of 1982-1983 there had been a big fire and destruction of the goods in the central godown where the stores meant for all the units had been kept, still, admittedly, the employees of the other units have been paid more than what had been paid to the workmen of the Madras duty free shops which is irrational and incommensurate with the activities taken by the Corporation is clearly a discrimination shown to the workmen of the Madras duty free shop, much less the members of the petitioner's union.
19. In these circumstances, it is high time that the management rectified its past mistakes and adopted a uniform policy at the all India basis in the determination of the bonus that is to be paid to the workmen of all the units and it is also feasible since it is admitted on the part of the sole witness for the Management that an all India balance sheet is also prepared based on the profit and loss accounts of all the units put together.
20. For all the foregoing reasons it is hereby decided that 'Functional Integrality' exists not for the separate duty free shops at each and every place but it lies only with the all India Tourism Development Corporation Limited as the sole Management not only for the purpose of running the duty free shops at different parts of the country but also for the purpose of payment of the bonus for its employees at all the units. Hence, the only irresistible conclusion that could be arrived at regarding determination of the quantum of the bonus payable to the workmen employed in the duty free shop at Madras in the year 1982-1983 should have been decided at the all India basis taking into account all profit and loss arrived based on which a consolidated balance sheet prepared and the payment of bonus for all their employees of all the units determined without any discrimination. The third respondent Labour Court has failed to analyse the legal position as propounded by the Apex Court in defining the 'Functional Integrality' of the Industrial Establishment in this case resulting in the wrong conclusions arrived at treating the Madras unit as a separate industrial establishment having its own separate and independent identity and existence which is not in the case in hand. The third respondent Labour Court has committed patent errors of law and perversity in approach so as to warrant interference of this Court into the award passed by it.
21. In result, the above writ petition succeeds and the same is allowed.
22. The award passed by the third respondent Labour Court in I.D. No. 682/1984 dated September 24, 1990 is hereby quashed, (i) The first and second respondent Management is hereby directed to determine the quantum of bonus that is to be paid not only to the members of the petitioner union but to all the workmen employed in the Madras duty free shop based on an overall balance sheet drawn on the basis of the profit and loss account arrived at by all the units in the country and settle the said bonus to be paid in favour of the workmen of the Madras unit for the year 1982-1983. (ii) The management is further directed to follow the same method in the years to come. In the circumstances of the case there shall be no order as to costs.