M/S. TULSIDAS KHIMJI versus THEIR WORKMEN

M/S. TULSIDAS KHIMJI versus THEIR WORKMEN

The Supreme Court held that workmen could claim bonus on alternative bases—profit-sharing or customary—but not as an implied term of contract, as such a case was not made out in pleadings. The Tribunal was justified in recognizing the existence of customary bonus. For income-tax deduction from profits, it was not correct to allow double deduction—one for firm and again for individual partners. The correct approach was to deduct Rs. 53,000 under income-tax. The amount allowed to partners as remuneration was considered low but was not altered by the Court; the Court's role was supervisory, not appellate, over quantum. The majority dismissed the employer’s appeal and upheld the Tribunal's...

Parties
Appellant: M/s. Tulsidas Khimji; Respondent: Their Workmen
Jurisdiction
India
Judgment Date
11 April 1962
Procedural Posture
Civil Appeal / Appeal by Special Leave From Award of Central Government's Additional Industrial Tribunal, Bombay, Reference (cgit) No. 4 of 1960
Outcome
Appeal dismissed with costs.
Legal Topics
Bonus, Customary Bonus, Profit Sharing Bonus, Industrial Dispute, Deductions From Profits, Income Tax in Partnership Firm
Labour Law Industrial Law Bonus Customary Bonus Profit Sharing Bonus Industrial Dispute Deductions From Profits Income Tax in Partnership Firm

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Legal principles 3 Authorities cited 9 Party arguments 2 Amounts and remedies 2
Sign in to unlock

Parties

M/s. Tulsidas Khimji

Appellant

Their Workmen

Respondent

Procedural Posture

Civil Appeal / Appeal by Special Leave From Award of Central Government's Additional Industrial Tribunal, Bombay, Reference (cgit) No. 4 of 1960

Legal Issues

  1. 1 Whether workmen can claim bonus under the heads of profit-sharing, implied contract term, and customary/festival bonus simultaneously or must elect one; Correct deductions from profits of a partnership firm for income-tax while fixing quantum of bonus; Whether customary bonus was established in this case

Ratio Decidendi

The Supreme Court held that workmen could claim bonus on alternative bases—profit-sharing or customary—but not as an implied term of contract, as such a case was not made out in pleadings. The Tribunal was justified in recognizing the existence of customary bonus. For income-tax deduction from profits, it was not correct to allow double deduction—one for firm and again for individual partners. The correct approach was to deduct Rs. 53,000 under income-tax. The amount allowed to partners as remuneration was considered low but was not altered by the Court; the Court's role was supervisory, not appellate, over quantum. The majority dismissed the employer’s appeal and upheld the Tribunal's...

Court Disposition

Appeal dismissed with costs.

Orders

  • A sum of Rs. 53,000 is to be allowed as deduction under the head of income-tax; not to permit double deduction for income-tax.
  • The Tribunal’s amount for partners’ remuneration was not altered by the Supreme Court.