The PAYMENT OF BONUS ACT, 1965

THE PAYMENT OF BONUS ACT, 1965 (21 of 1965)r ..1!1.n Att to proa.idr,for.th(_poymcrt of bonus to r,,rrr::rti;;i:;::to:r','rl,!ri) t'sloblis,htn'nts on t.ht,b.nsis of profits-or on lhc bnsis of production oi prbductivify and lor tnn ttcrs conncctctl tht'rauith.l Bl; it enacted by Parliament in the Sixteenth year of thc Republic of lndia as follows:- l. Short title, cxtenl and application.--( I ) This Act nray be called the I'ayment of Bonus Act, 1965. (2) It extends to the whole of India 3[-**]. (3) Save as otherwise provided in this Act, it shall apply to_. (a) every factory; and (b) every other establishment in whlch twenty or more persons are _ employed on any day during an accounting year: {[Provided that the_ appropriate Covemment rnay, a]ter giving not less than two months' notice of its intention so to do, by notilication in the Official Cazette, apply the provisiorrr ot lhrs ncl \r.ith eftmt lrorn sullr .ri:ounting year as may be specified in tht, notrhr,.alkrn, to.lnv r,stll:'l jshmrnr or cla=si of establishments..[including ,rn c'st.rbllilrrn.'rrl [rlng.r t;r(torv rvilhln the mcaning of sub-clause (ii) of clause (rn) of section ? of lhr,f.rr:krrir-,,c,\r'f. lqa$(63of l94gi emp_loying such number of persons less than twenty as may be specilied in the notification; so, however, that the numb(r of persons so specified ;hall in no casc be less than ten.l (4) Save as otherwise provided in this Act, the provisiors of this Act shall, in_relation to a factory or other cstablishment to which this Act applies, havc effect in respect of the accounting year commencing on any day in the year 1964 and-in respect of every subsequent accounting ye;r; '[Provided that in relation to the State of Jammu and Kashmir, the reference to.the accountht year commencint on any day in the year 1964 and every subsequent accountint year shall be construed as reference to the accountinl year commencing on any day in the year 1968 and every strbsequent accountin[ year:l b[Providcd further that when the provisions of this Act have been made appticable to any establishment or cliss of establishments by the issue of a noiification under the proviso to sub-section (3), the reference to the accounting yyeeaarr ccoommmmeennccilnngg oonn aannyy ddaayy iinn llhhee yyeeaarr 11995544 aanndd eevveerryy ssuubbsseeqquueenntt aaccccoouunnttiinngg year rrl as the case may be, the reference to the accounting year-commcncing on 1. The Act haF lreen extcnded to Goa, Daman rnd Diu by Act 6 ol n-n, sec. 2 and Sch. 2 Subs by Act 23 ol 1976, s€c. 2, tor the tong fitle (w,r.e.f 25-g-1gZS) LonE tirle, before substitution, stood as urderl "An Act to plovide for the payment of bonus to personF employed in cert.rin establishmenls and for mattcrs cofflected therewifh,', 3. The !r'ords "cxcept the State of lomnru and Klshmit,, omitted by Act 51 of 1970, sec 2 ind Sch (w.c t l-9-1971). 4 Addcd by Act 23 of 1976, sec 3(.) (w,r€-t 25-9-1975). 5. Added by Act 51 of 1920, sec, 2 and Sch, (w.e.t. l.g.tg?t). 6 Ins by Act 23 ot 1976,6ec.3(b) (w,re.f. 2j-9-1975) .t The Payment of Eonus Act, 1965 [Sec 1 any day in the year 1968 and every subsequent accountinE year, shall, in relation to such establishrnenl or class of establishments, be construed as a reference to the accounting _vear specified in such notification and every subsequent accounting year.l tl'*l (5) An establishment to which this Act applies shall continue to be govem€d by thrs Act notwithstanding that the number of persons emploled lherein falls below trventy 2[or, as the case may be, the number specified in the notilication issued under fhe proviso to sub-section (3)]. COMMENTS A pnrt-iime employte is .lso an enrplolce for the purpose of calculating the number ()f crnployces.-2o or nore-under sectjo 1(3\(b, Autotuobilt Ktnmcha songh v lniust tt fIb nal tt976) 38 Fl R :(,8 (All). . 2. Definitions.-ln this Act, unless the context otherwise reqrrircs,- (1) "accounting year" means- (i) in relation 10 a corporation, the year ending on the ctay on which the books and accormts of the corporation are to be closed and balanced; (ii) in relation to a company, the period in respect of which any prolit and loss account of the company laid before ii in armual general meeting is made up, whether that period is a year or not; (iii) in any other case- (a) the year commencing on the 1st day of April; or (b) if the accounts of an establishment maintained by the employer thereof are closed and balanced on any day other than the 31st day of March, then, at the option of the employer, the year ending on the day on which its accounts are so closed and balanced: Provided that an option once exercised by the employer under paragraph (b) of this sub-clause shall not again be exercised except lvith the previous pcrmission in writing of the prescribed authority and upon such conditions as that authority may think fit; (2) "agricultural income" shall have the sam€ meaning as in the lncome-tax Act; (3) "agricultural incorne-tax law" means any law for the tim€ being in force relating to the levy of tax on agricultural income; (4) "allocable surplus" means- (a) in relation to an €mployer, being a company 3[(other than a banking company)] which has not made the arrangements prescribed under the lncome-tax Act for the declaration and payment within India of the dividends payable out of its profits in accordance with the provisions of section 194 of that Act, l. The words "under clause (b) of sub-section (3) ' omitted by Act 23 of 1976, sec, 3(cxi) (w.r.eI 25-e-1975) 2 Added by n cl 23 ol 1976, sec. 3(cXii) l\tri e I. 25-9.1975), Ins. by Act (6 of 1960, sec. 2(a) (w r.cJ. 2l{-1980). Ear)ier the woJds "(other than a bankrng cornpany)" werc omitted by Act 23 of 1976, sec. {(aXi) \wr.e.t.2r9-1975t Tho Paymenl ol Bonus Acl, ,965 srxty-seven per cent of the available surplus in an accounl.ing year; i" ' , r ., " 9 l 1 "ny other case, sixty per cent of such available surplus; (5) "appropriatb Government,, means_ (i) in relation to an establishhent in respect of which the a 79 p 4 p 7 ro ( p 7 r 4 ia t o e l G 7 o 9 v 4 e 7 m ), r i n s e n th t e u n C d e e nr r r a th l e G I o n v d e u r s ru tr n ia en l t I , ) is th p e u te C s e n A tr c a t, l Govg11lmgnl' (ii) in relation to. any other establishment, the Govemment of the )(are rn whrch that other establishment is sihtate; (6) "availab_le surplus,, means the available surplus computed under .section 5; (7) " award" meansa ann y dispute or of H':lr"f#.il.8:Tl1: Industrial Tribuna constituted under the li::l]j|PfT,'les 1s47 (.t4 of.1e47l, o, uy a"y otne, urir-r,o.,ty constituted rlnder a _ n a y ct , c orresponding law relitin/ to _"".ii"ut on aanndd sseettttlleemmccnntt oofl iinndduussttrriiaall ddiissppuutteess iinn ffoorrccee iinn aa State aanndd iinncc]luuodeess aann aarrbbiittrraaltiioonn aawwaarrdd mmaaddee under sseeccttiioonn 1IO0AA ootf that Act or under that law; a banking company as defined in section Act, 1949 (10 ol 1949), and includes rhe sidiary bank as defined in the State Bank Act, 1959 (38 ot 1959), 2[any p::l,le il,ff".11'f ffi:,llf ;:; 9oltt.,ie_s lncquisitio,irlendd ,5 1970 (5 of 7920),3[any cbrresponding new bank const,ruted under section 3 of the Undertakings) A defined in clause 1934 (Z ot 1934),1 and any norified in this behalf by'tt .. , A -co-operarive bank is a banking :"?y"Yr:Yi,,. cfttrat co-op. Bn k Ltd. v. tnh$t,ltt Inbuhal, ll9a9) 58 Ft,R 924 (Mad) (9) C c o o m m p p a a n n ie y s " A m c e ; a n 't9 s 5 a 6 n ( y t o co t r t n is p t a ) n , y a a n s d d in e c f l i u n d e e d s i a s f s o e re c i t g jo rr n c - o 3 m o p f a t n h y c within the meaning of section 591 oI that AcU (10) "co-operative society means a society registered or rJeenred to bc registercd under the Cloperative Soiteriei act, 1912 (2 ot.t9t2), or any other law for the tirae being in force in any Statc r€latrng to co_ operating societies; 1. o Ih m o i . tt w e o d r d b s v " A a c n t d 2 3 _i n o c I l u 1 d 9 c ? s 6 , a s | e y c . a { m (a o x f i t i r ) t ( t \ r t €a l L ed e t a 2 s '_ g s - u 1 c g h 7 5 u ) nder liub{iection (2) ot srction 4,, 2 lns. by Act 23 a( 1976, sec 4(b) (w..e.f 25_9_1975) 3 Ins. hv Act 66 of t980, cec Z(bj (w r e t. tt-8-t980) me Payn cnt ol Bonus Act' l 5 (S€c. 2 01) {12) l'}) i implied; (14) "erirploycr" ineludes* thnn atr n:itabllshment in Publif, sPdor; *uior"il*r,rnr"ort in pubtic sret$r,' m*ilns an fglnbli$lwfnl (}l{,n{rii. {.{.1 (b) an forly.per ccul ol ih; caPitnl t'Y- togcthcr) (i) the Governmcnl; or l(iiiii) tthtee RReesseerruvee Bbaannxk oofr Iunrdqiraa;; orrrr l(iiiiiiii c.ootrppootr"attiioonn oowwnneedd bbyy tthhee GGoovveemrnmmeenntt oorr tthhee RReesseerrvvee :l "" Bank of Indla; i. s .. " . o " ., w ' i.ie r . - r .- - 2 - 0 -. 1 . 6 , , . s -. c ^ c - - 2 - , . . f L or . ri " h tc ,+ n -l t ir h o v u s a a . ^ r d 4 5 r o u f p a e n w d o f r i d ve s l i i ilil'iiitr: ted ruPees weft substitutcd by Act 67 ot l9tD, eec 2, ror rne worqs '"' -'---"* --'- - - hhuunnddrrccdd rup€es' (w.r.e.f.7-11-1985) The Pavment ol Bonus Act. t965 (17) " faclory" shall have the same meaning as in clause (nr) o[ section 2 of the Factories Act, 1948 (63 oI 7948\; (18) "gross profits" means the gross profits calculated under section 4; (19) "Income-tax Act" means the Income-tax Act, 1961, (43 of 1961); (20) "prescribed" means prescribed by rules made under this Act; (2-l) "salary or wage" mearu all remuneration (other than remuneration in respect of over-time work) capable of being expressed jn terms of money, which would, if the terms of cmployment, express o. implied, were fulfilled, be payable to an employee in respect of his employment or of work done in such employment and includes dearness allowance (that is to say, all cash payments, by whatever name called, paid to an employee on account of a rise in the cost of hving), but does nol include- (i) any other allowance which the employee is for the time being enfitled to; (ii) the value of any house accommodation or of supply of light, water, medical attendance or other amenity or of any service or of any concessional supply of foodgrains or other articles; ( iii) any travellint concession; (iv) any bonus (including incentive, production and attendance bonus); (v) any contribution paid or Payable by the employer to any pension fr.rnd or provident fund or for the benefit of the employee under any law for the time being in force; (vi) anv retrenchment compensation or any gratuity or other retirement benefit payable to the employee or any ex Sratio Payment made to him; (vii) any commission payable to the emPloyee. Explanntion.-lNhere an employee is given in lieu of the whole or part of the salary or w^Ee paybble to him, free food allowance or free food by his employer, such food allowance or rhe value of such food shall, fot the purpose of this clause, be deemed to fonn part of the salary or wage of such employee; COMMENTS (i) l-,ry-off comperEation ii included in dre term of "salary" or "wngcs"; Mohqn Xumnr v Det'ul_v LALout CommissioncL (1991) 62 FLR 903 (Ker). (ri) Deamess altrowance and city comPensatory allowance are lncltlded in the dciinitior oI "sn[^ry" o. "wages" undcr section 2 (21) of the Act; S Krishnamwthy v Pt?sidinq Ofirtt, Iabo r Cou+, 0986\ 55 FLR 535. (iii) Dearncss allolA'ance is d pnrt and parccl o( wages; S.inlia Naoigalion Co I'td v Stindia Employees Ution, (1963) 2 t,t.N 61, (iv) Retainnrt allowance comes within the purview of 3eclion 2 (21L Challhnn Vidltttt Seltkati Lldvoi v. Goocrnmenl Ltbow Offcct, AIR l98I SC 905 (v) RemuneraLjon in case of overtimo work and conrmission Payable to employees arc exclrrded from the definition of "sala ry" or "wdqcs"; AMnrlxt Vollas I volpnrt Emplovecs' Fuhntnn \ voltns Lld , 1973 bb IC 645. (vi) Ovprtime allowance does not form pa.t of "w'ages"; AssocQtcd Cedenl Co Lld 1J ThPtr Wartnrr'r. AIR 1q59 SC 925 The Pavmenl ol Bonus Act' 1965 [Sec.2 (22) wo'd.s and expressions used but not define.d in this Act and defined in the lndustiial Disputes Act, 1947 (I4 of 1947)' shall have the mcanings resPectively assigned to them in that Act 3. Establishments to include deparlments, undertakings and branches'- l\ |tr ll.rJr art br.ilrdlc!, or rl|l.JrLr1rr, be er'ultlishnre nt ior' {lr(" Pnrfnsr t:t rnttl}-rutation of bonus under this Act: I ilny accountinS year a seParate balance-sheet and FnJlr prepared and maintained in resPect of any such i *1]n r Ur-anctu then, such department or undertaking or br',urrh rh.;lll hi: trra{td irF a separate establishment for the purpose of comp[tation of bonus, under this A(t for that year, unless such dePartment or undirtaking or branch was, immediately before the commencement of that accounting year treated as part of th6 establishment for the purpose of computntion of bonus. COMMENTS Branches o[ an e cd as Part of rhe same establishment for the prLrpos€ of computatio in an accounling yeaf' a seParat€_balan(e sheel is maintoine,J ui r.spec ranch shall bc treated !s a seParate estabLtshmcnt; ioi*. l " l \ l . s C o^ o o, m yo p O u rg t a it n i r o cs n \ ru o lit f r ) g I r td o s v s ' S P on ro lliy f o it s O . r - y T on h ts e (l S nd r i o n) s s I-f d p " r 1 o 9- f 8 i 1 ts L a d b e IC ri v 3 e 63 d ( A b ll y )' an employer from an establish-mcnt in tespect of the accounting vear shall- (a) in the case of a banking comPany, be calculated in the rnanncr specified in the First Schedule; (b) in any other case, be calculated in the manner sPccified in the Scc<,rnd Schedule. I 5. Conputalion of available surPlus.-The awailable surplus in resPecl of ,.aou.,ii,lg year shall bc lhe gioss profits for lhat year after deducting " th n J u r cfrom thc ir'rms referred to in sectk n 6: 2lProvided that the available surplus in rcspect of th€ accounting year comnrencing on any day in the year 1968 and in respect of every subsequcnt ot- dccounting year shall be the aggregate 1j irre gtoss profits for that accounting vear after deductint thercfrom tlre sums referred to in section 6; and (b) an amount equal to the difference between- (D the rlireci tax, calculated in accordance with the provisions of section 7, in respect of an amount eqtral to the 8ro5s profits ot the employer for the rmmediately preceding accounting yeau .1no (ii) the direct tax, calculated itt ,'r:r i:r,l;r'tcL' irilir llrr lltrr!')srfrh or section 7, in resPect of an Jnrotinl r:rluJi l{r lilrl 6rtrrs pti:ltls of the emPloycr for such ;,rrccdrnF, 'l"oLrrlltrl!l vt'rlr r'tller deductine therefrom the arnrlrnf {)t bonti:i rthir:h th+ cl)rlhr}er Subs- by Act 66 of 1980, sec.3, for $ection I (wr'e-f 21'6'1980) Earlier ssction 4 was subsfiluied by Act 23 of 1976, sec. 5 (w-r-e.t. 254-19751' Addcd by Act 8 of 1969, sec 2 (wet 26-3-1969) { The Payment ol Bonus Act l s has paid.or is liable to pay to his employees in accordance with the provisions of this Act for that year.l u.-.S,"T: deductjble fron gross profits.-The foilowing sums shall be deducteda frtroomm trhnee ggrroossss -pprroohfittss iass pprriioorr cchhaarrggeess,, namely:_ (a) any amount by way of depreciation admissible in accordance with the provisions of sub-section (l) of section 32 of the Income-tax Act. or in accordance with- the provisions of the agricultural income_tax Iaw, as the case may be: Provided that where an employer has been paying bonus to his or an award or agreement rnade nd subsisting on that date after notional normal depreciation, then, deducted under this clause shall, at r (such option to be exercised once and ate) continue to be such notional normal depreciation; (b) any amount by way of l[development rebate or tnvesrment allowance or development allowancel which the emplover is entitled to deduct from his income under the income_tax Ac[; (c) subject [o the provisions (f s€ction 7, any direct tax which the employer is liable to pay f<rr the accounting year in respect of his income, profits and gairs during that year; (d) such further sums as are specified in respect of the employer in the 2[Third Schedule]. COMMENTS - T exl . o ( o i l ) C B o o n L u l s d p v. . dcduction under the In.ome-rrx Act; (ii) Alt direc prior charges in o . u e r p d o e s d e u c o te fb d o n fr u o j m ; 1 t 9 h 2 e 5 g L r L o t s { s B p o r m r)f iL 13 s 3 d 9 s rect tax payable by the employer._3[Any direct tax I for any accounting year shall, subiect to the following at the rates applicable to the income oI the employer foi (a) in calculating such tax no account shall be taken of_ (i) in respect of any previous under any law for the time s; (ii) any arrears of depreciation which the employer is entitled to add to the amount of the allowance for depreciation for any following accounting year or years rrnder lub_section (2) of scction 32 of the lncome-tax Act; l sut's. by Act & ot 1980, sec 4(e), for 'development rebate or development allowance,, (w r.e f. 21-8-1980). 2. Subs by Act56 of 1980, sec,4(b), for,,S€cond Schedule,,(w r.e.I.2l-8-1960) Eartier rhe words "Serond Schedrde ' were substituted by Act E oI1976, sec. (, for the words ,,Third Schcdule,, (w r.e.t. 25-9-1975). l Subs. by Act I o{ 1969, sec. 3, for "For the purposc of clause (c) of section 6, any direct tnx psvable by the employer" (w,e,f- 26-3-1969). The Paymenr ol Bonus Act, 1965 ls€c,7 {iiil .rny r".trrnption cr:trlertud or the ornl:luvL'r urd('r \e( titln ll+ I lhc lntttnrr:-lar Act ur of nnl ilr(l$(ti(xi lir whirli irc is t'ntitl':ii undcr sulpsctti{rl {1} $, vritiotl l{Ji (,1 tll 1 i\rl, d! rn lorL{l inrnreillatrely beftru tlu cun\lnsrletnt'r1t ul tlti'liitr;ncr' A.L, l9$5 (10 of l9{i5}; (bl ilrt{rrss{*d wilhin thr me;rninE, lrf lhJt A(lj (i] rrnl iv jded l;'rtrrrll, fftr: le b e"l'lx A't sh;rll be 1;n [n' hirn frum litt' cs|.lblishnrnt tdl x{htr* llre jtfi olil\ 'rnd Biirli ijerjvccj frgnr Jit'oul l]'rf lndia .rtlil ;inl. rel)n ll!- hw lur lhil lirnt hding in krrc$ relnting t(r dire(l l xrs, then. rrl;tttiiunt llr':ll tri: {lrkon t]}f ttrdl r{hatc; I {e} n irctoun{ stu l€b"rte lir'n r{tlittt (lt ltllir {)I dfv t 'li rrtdit tr n:liPf t lrcrcil ]lr('rtt st'di(fi) ill llrl'l Pa!'mrnt tll lnl tlir'rtt ilx ollor.'t'ri lltrd( | 'rn\ lr''\ i.r thc li$rt' 11{lin$, in ibrce rukling t{r dir({! t;l\ul' or tlllricr lhr relf '' ']r.lt )" i11{il l!ll \ g tled to be Paid bY his empl the Provisions of this Act, establisl"ment for not less tJran thirty working days in that Year. COMMENTS i;: il..lrr]n * tjrl"r'::r' r.vlrr. hatt *r)*r'd, tur turl k'ss ll r1l 30 It rb i il;\' nre cntiued to bonlrs; /K. rir*,;:rr1 Ir lrrrrrlrf frilrirl r. i'ri,,7 ir l.r?li,irrr {.4trl- ilq9Ll i!: frl lL:tl: (Bom)' irir r1','.tr.r: $ h,r fi^1'1, .)Ptin! h, nlltrlLl t{l l!{tl\ itl lh't' i'l l'rrt prl'rr1i!{E aro ehhtled to bonru' Kd-'ci ;i,j\f:,;$"p! f,f"ru,::"]Jo;.t "tlonr.kri/r n"g olrtnrPsta frJtr-;fti im,1'e!rrb;rarrs'. ilslrarrril|'!,h iF9Fih{ h i' l ' \ t r r t 'i l i t r rrlrri::,I']1';'r'"lillsItd\LChatdn Poglnd C.'[tit'cdt, (1976) 32 FLR 323 (n,1 a probationet Li eliSible tor bonus; Bcnk ol Madua LtJ 't Bank oJ Mdun Lnfloves' Unbn' 1970 ( L v a ) b E v IC er v 1 2 c 1 r 5 n . Ploytl' r5 .'nh li.d i* hrltnt. i {tu'\r:r;r ir rles Work v Ll ian aJ I din AIR 1966 Ker 143 i. Oisquatlfiiation tor hon{ls.-liuhr-ithstanding anything contained in this Act, an employee sh;lil br dlsqunlitir-'i-l ironr rcceiving bonus under this Act' if he for- is dismissed from service (a) fraud; or O) riotous or violent behaviour while on the premises of the establishmenu or 1. Subs. by Act 66 of 1960, sec 5, for "(othe. lhan develoPhcnt t€bate or develoPmenl allowance)" (w.r.c f 2l-6-1980). Sec. 111 The Paryent ol Bonus Act, 1965 (c) theft, miSaPProPriation or sabota8e of any property of the establishment. COMMENTS iJ Lrefully gone through a distinction cannot be drartn -. ; Ue'orier of tteernriiiinnaattiioonn oorr PPrriioorr ttoo tthhce oorrddeett ooff l ; e ; " ; r ; m il i ; o i a ; t ; io .. n k o -r n ^ a , t hc ba o r n is f a a p ?i P s, li c is a b s l u e s t 1 a o i n t a n b " ie U o in n l * a w "i ; s K " r " ; f t P fa ia y i a t' b cs le t 't . d un vde ll tb th o e u A ^ -r c ( t o LH u Je r 6 t 6n l .(6 t e t ' H ar y rrw d A c ard r l u rdn b ro o n d g ' 2 " m -" 2 i ( ( , i 3 i ? ) ) B L ; o . L n ; I u ; 6 s ; 1 ; 9 c ; a i B n i o . b i o e , . ' f i o n rf . e o ted und " c * r , s i e i c ii ti " o l n , 9 v o if n r l ' y s w c it o h i r i c ' fe r r ' e o n c ' e z n to d a A c d c d o t u n L h a n b q o li v e C a o r u in a " w ( h le ic g h 6 ) th 5 c 2 rree during the accounting year or one ,ihether oi not the emPloyer has any not comPleted fifte€n years-of.age at orovisions of this section shatl have t1re words "one hundred ruPees", the COMMENTS Ex'stulio bo^ns is not a bonus within tne meaning oI seclion l0 of Lhe Act; R P C Offcers' tssocintin v. R.P C., 1990 LLR 222 (Raj) the accounting Year subject wa8e. sectlon, the amourt set on isions of section 15 shall be taken into account in accordance with the Provisions of that section'l STATE AMENDMENT llA Section Maha!{thtrar Alter section 1l of the Payrncnt of gonus o thc State o[ Mahara M sh . tr r a , , j t t he followi { n g seclion shall b r e uflts undet this A th c e t s s a h 1 m a 1 l A l e . b i e n M N l a lr i h t | t r ! r s r e l l N c r z I - ' l,w e't' tz-r'zvttt t Y crediting [Vrdr COMMENTS c*ri, B , J r n l u ii s p i o n t c - x c€s L s td o v f. - l lo T c he a b 2 l n c d s t u h rP ,; l s us li a €a l r u T ro ti t b t/ b n e a l c ' l W aim es e t d B b e y n g e a m l' p l l 9 o 7 yc E c s I' ; a o b ic lc n ta 58 l 6 M ( a C c a h l i ) nefv & ciuil i i i i " : 1 U i .' , " , ) a i 1 U i 1 i " " i n i i a *^ " f " g ;i s i o ' i * f h' 1 ( t 9 , 8 t t g 0 " z , a i l , e * u c r y " 5 z r , . f i t o * r z " : s ' e t' c t t i g 1 o e n 7 1 6 2 l , 0 - r s s ( 7 < w 2 \- t 7 a 'e n ( w d t r 2 b e l v - 6 I A -1 c 2 . 9 5 t 8 4 'e 0 2 'r ) " e o E f 7 1 s d e \ r ' 7 li 4 e ' ! s s e e c c l 2 io ( n w l 'e 0 . r w 1 a r s - SuOs, iy,qa 6O of t98O, s€c. 6 (w r'e t- " 2 t 1 4-1980) E€rler scction l l $'as omitted by Act 23 ol 1976, sec. a @t.e 1 254-1975\' 12 The Payment ol Eonus Act, t96S lsec. t2 Ssa, r[12, Calculation of bonue with rc ( alloct bo,nu is n0 sectic bonu be ca up to ectiorL the expression "scheduled Iroutt as assigned- ta it in clause (t) of li l1 of 1948).1 bonus in certain cases.-Where an s th h e a l p l , ana ({ may ofw ser o! actou natel accoll CoMMENTS In the ca-s€ ol n ound,*t rtr{., -,$u ii ! lifirr' in nny accolurHng l,$.nr' r+lictr-iS* ernprtop,. Jn*.inrL.l 'tt is aclually allowljd tr s.,ra. Lrl, !rr'-."rtut l9d5 s. 7i$, r.l,, uu 14, ('.rnrFulatton of numher of w oI n% ] 13, an emptivee rhall be dr"*nrr:d to LLI accounlinfi ydar nlso {rn thr da}.$ on 1t 1.ri hc has lpen l:id of f under an esl orders under the Industria this A 1946 (20 ot 1946). or under under 1947), or under any other I *r rlu *rtri:lkllnrrnl; and (l (b) he has been on leave with e; 0, (c) iu' to temporary disablement caused bv the er .r(Li in the iourse of his employment; and' sewicr (d) the maternity leave with ialiry or wage, i. re6l duf s[15. Set od , ,'Jt, Whcre lor any rFI e p s ro ta v b is li t d io )r n m 1 a 1 t. , f i t i h $ L m "n , b th o s n e i t ll 0 . of sect (11 Itrt.rl s,rlarl or wJgc ot tht'enrplrrvccr in whi rrunling rr',rr, t'"' r:.-rrritrl i.rrr.lrr.l lor eilr and g{} (:fi ufr lu and vr r:ll render nrF F rF{}sll of p vlnrnt us in section ulc. .i. tot)a bt Afl th $l lSSt|, i.fll" i|, J,ur s$rtj{rn 13 (rf,!.r-t .!I-8-lqSUi frrli}r *-!ti{rrl 1:} !v.ri bl A(-r 6li ol l-qZ?, rtlr, ,1 ($-.(.f, tS"tt-t$?:J. tr! ,\rr ^r* dl tp?1. s{,!. t} t$...t, 1"4-!ty.t; !t.12{rilf/74"sg.,f irv.e"l', l l .!}. 1!}74} nnJ rvnr rul}iritu i*il tr r Ad l"} <!t l }:6, ,{,r. t r} :.!- t97:j) 5. Subs. by Acl 66 of 1980, sec. 9, 60r s4tjon 15 (w.!.e-( 2l-6-1980). Errlier section 15 was 25 subslitufed by Acl 23 oI 1976, sec. ll (w.t.e.t. 25.9-1975) Soc 161 The Payment ol Bonus Act, tg6, 13 it]T I . t lh l,L l. l: s , u :" rp ,, t , u ? s :^in" i: r ^ es ,^ p . e - c : r ' : o ,' r l l1 ,r, q u j ] i r * 1 , r ,, o r i l l 1 , e r i 1 ,i i , ; * , Ir ;; n ; J ;i .. 1'i"L.l.r;5;t.i,. ,;:iu'i,Lr',l,;,,ti\" 1o't,, r L * ,a t (. bb| 1 : 5 ooi nn n juu o ss a Pp f1 a m a y y ^o a 1u b ?n le ]:t tt o oo r tt hh s ee u e f e f mm ic pp ie lloo n yy t ee e a es m s o iinn u n i t ic( : c ee J ss l tt r ,. j ,. { rrtt { rr J ]i!!, {r} f hr o rqr l rr r r{ r ",l- i , r ,r r ,, r ,, j *n ,, , t ; t. ; "" 1 r. s "- J "n ..* sS ,., u i v _ii ii .. ., {f .n iJ . 1t 11 I rlii , Ur ;r rl n iiiiit d irr L !:i, h u!ff i r : \ ( ll.:]:::'l ll.:ll:llcrrutd Lrr: rrrjtisert liir rhr: ;lrrprr:s4 ,rr s..,,ir*.,i.'.,,, Lht nrjr.rrnrrrr.:, ll,l:l:: lll'::-irl:,,,rninrmrnr :rmr)rrnt o-r,,iJ"ii,:i-,",,i,' ;i;:i,,; l;i:,;';ll':li:i; {r h ul t lp' 'r ' ff , ri lr lr r '. rr , , r " l ti h nn r cc r li ' : . :: . : , rt , ss 1 ii r rl. d .rr f {o r ] r ff r tt l hh .r rr e in lttt g riiu r s rri c ihh r o aa l tc l -c c i rr n ttuu n , n f t r ti " irn r l gg : ,r !,, u (, . .1 i" r , . in fi, i { i h '" r , " rl. ir, lri , t ,lr]t urr,'{{ :' i fl i g IiJ llh ', r " {.,:t ,tr ,r; : .. il , 1r , t6 , , , (, i l i I " n n., r lfl u t. ,, l . , r ' l"otlr{h rLlr*Li }e. ff as illustrated in the Fourth Schedule by srrLsection (l) or srrb_section (2) for thrs Act. ny amount has been carricd fonvard and in calculating bonus for thc succeedinc t?l8l'"tTt'"0 forward from the earliesi accorrntjnt year shaI first be raken ,"," o / I . f -' , L 2 0 I t , J h L '2 c i , n . o l e b 4 r m d l r p i 4 t ( l ' C a o , r a y > c l c f ) s . r p i a i n s y i a b n c o S m u n b u d o n n r t in t o s e D h v . a t \ a ' s i 4 w r ? i, i o t i h , o f r €f w c t l ) a c E g n e c i s * e o ir r t o , f h ! L c €d r i d o rh . ^ a v s x . i m C l u 0 t r .7 n a . , n ( b 1 o d 9 n s I u 1 l s , ) lii,.5pc':iil trltovi$i{r I I'N,rbliiltrnf nt ntt!, shments,_1[(t) Where ii 4it. thr rrl.,lti a $ ! '{_'er the commencemenl of r |r ti s Aft ill ,hr-rl titled to be paia bonus ub_sections. (l A), (lB) :rrxi i ir-,. provisions of this Act in rehtion to that year, but without applying the provisions of section 15. tr, "t' ," ot 'I'l may be, shall be made in the manner ulel taking into accounl the excess or ay be, ol the allocable surplus set on and sixth accounting yeais; \',/ ar- irrustrated in rhe 2[Fourth sc."T:[ft -:l'Ji"T #::#J::il:$; !:t::llftf lly. 1' r.h.q .o;:9 TuI Lc, or ii.," oil;;;4" surprus scr on or ser olt rn respect of ihe fifth, sixlh and scvcnth accounling ),ears. I l 2 :b 5. ^ 9 s - , 1 b 9 l_ 7 1 5 A \ ct 23 ot 1976, stc l2(a), for snb-scct;o (1) n^d Eltldnttiohs rh{irck) (!1,.r,c f. z. Subs. by nct 66 of 1980, scc, 10, ft)r ,,Thrrd Sthrxtute,, ($,r'c.f 2r_8-19g0). l4 The Payment ot Eonus Acl, 1965 (Sec. 16 (lC) From the eighth .rccounting ycar following the accounting vear in which the employer sells the goods prodtrced or manufactured by hirn or renders services, as the case may be, from such establishment, the provisions of section 15 shall apply in relation to such establishment as they apply in relation to any other establishment. Exphnation I.-For the purpose of sub-section (1), an establishr:rent shall not be deemed to be newly s€t up merely by reason of a change in its location, management, name or ownership. Explanation ll.-l.or the purpose of sub-section (1A), an employer shall not be dccmed to havc derived profit in any accounting year unless- (a) he has made provision for that year's depreciation to which he is entitled under the Income-tax Act or, as the case mav be, under the agricultural income-tax law; and (b) the arrears of such depreciation and looses incurred by him in r€spect of the establishment for the Previous accounting years have been fully set off against his profits. the g E o r o p d la s n p n r ti o o d n u c // e / d .- F or o m r n {lT n r u f F a u r r t p u u r r t t d c $ d u o r l ir s ir u g b ' l s h f r c " l m i$ u r r r: " i e { l o A I ) l , h o { I l t r s i i t s l n r d n I n I i t n ]J g , . $ si l t ; ld in o \ i factory or of the prospeclinl! $ta$c oi ;rr'rv mini: fur arr ci{"ljtr}rl slr,lllf nu* be urketr into consideration and whoru anv q[()*tifn rrises u'ith rcgnrd in su{h pr{]du.ti{}n or manufacture, the decision of the appro;rr 1, (l A), (l B) and (1C)l shall, so far as may be, apply to new departments or undertaking,s or branches set up by existing establishmenls: Providcd that if an employcr in relation to an existing establishment c,:rrrristing o, difirr{rt1t liepnrh cnts {tr rrndertakings or branches (whether or not rn lh{: tirrr{ i drrarli s,:t rrf Jl dittcr$rt Periods has, belore the 29th May, 1955, [['' rr iinn** ll......rrllrruu--cc 11ii--11 tt]]rree ccmmFFllooffccooss rr..llff aallll ssuucchh departments or undcrtakings or l.r s iir1i-.rrs,{pr{o,,rrltiviv.r. ..rr[l tthhrt iiiinnhh''rr {{!!rrtt 1144''lliicchh ssuucchh departments or underlakings or bl;nrht,li 11"rrrr sut u F, (x1 tlrc ljir$i$ df thij consolidated Profits compu ted in resPcct i.rf ;rll rilr drlp;:rrtnlr"r'rl$ {r $nrtrcd;rkttrSs or branches, then, suclr gmployer shall br lirbl* 1rj bonus i;r.iccordlnec with the provisions of this Act to the tri;r-r, employees of all such departments or undertakings or branches (whelher set uP befbre'or.rfter that datcj on the basis ol thc coniolidated profits compured as aforesaid. 17. Adjustment of customary or interim bonus against bonus payable under lhe Act.-Where in any accounting ycar- (a) an ernployer has paid a y pujn bonus or other ctrstomary bonus to an employee; or (b) arr employer has paid a Part of the bonus payablc LInder this Act to an employee before the date on rvhich strch bonus becomes payable, th€n, the employer shall be entitled to deduct lhc amount of bonus so paid from the anrount of bonus payable by hilr to the emPloyee under this Act in resPect of that accounting year and the employee shall be entitled to receive only the balancc. I Srlbs. by Act 23 of 1976. sec. 12(b), fot "sub-se<tion (1)" (w.r'e.t 2i9-1975) Iie€. ?01 The Payment ol Bonus Act, 1965 15 (i) Claim of annual bonus -", .oo*too,H*Tltour qurMied by negoriarions/sentemcnts held io be custodrary in nature and not statutory bas€d only on seiiternent linked with pNductivity or prohb; Mutund Ltd v. Mukund Kamgor Union, iOOf tU) t-t_J 4lO olom). . (ii) Paymcnt of any crrslomary bonus, such as ahcnda^ce bonus, istival bonus, or fhe [kc, clocs.not ab:olvc the manrgedcnt from their lirbility to pay statutory b,)^us) Badythlth Bhdtfltl Mazdc,ot Union v. Eaidvantth Ayuruedt Bharpn pot, UA.,'IItts. tab IC 14S, (iii) The employee is bound to rehrnd the ex(ess arEunt ol bonvs; bndra Lnrinretinl & Foundary Works v. Stat? of Punqb, egmr 33 JL 538 (p&H). 18. Deduction of certain amounts fmm bonus payable under lhe Act,_ |.Vherq rl any accoun t ing_ yeat, an employee is forrnd guilty of misconduct ca using lfrinnaannccilaall lloossss ttoo tthh€ c eemmppllooyyeerr,, tthheenry, it shall be lawlul ffoorr tthhee eemmnplloovyeerr ltoo ddpeddrurccll tthhee aammoouunntt ooff lloossss IIrroomm tthhee aammoouurnt of bonus payable by him io [he emp]oyee uunnddeerr tthhiiss AAcctt iinn rreessppeecctt ooff tthhaatt aaccccoouunnttiinngg yyeeaaii oonntlyy anci the eemmpplroovyeeee siali be entitlcd to receive the balance, if any. 19. Time.limit for payment of bonus.-I[All amoultlsl payable to an empllooyyeeee bbyy wwaayy ooff bboonnuuss uunnddeerr tthhiiss AAcctt sshhaallll bbee ppaaiidd iinn ccaasshh bbvy iirriiss eemmppllooyveerr_- (a) where there is a dispute regarding payment of bonu3 pendirig deforc any authority under section 22, tithin a month from the late on wfuch the award becomes enforceable or the settlement comes into _ {!|rr,rli{n, in rpspe{l of srch dispute; (b) in anv otlurr mlc, rvithin a period of eight months from the close of as the lication he said fit; so, hntu"9-",9l, that the total period so extended shall not in any case exceed h/yo years. 'r*l 3[.'-l STATE AMENDMENT Maharashtra: In section 19 oI the Payment of Bonus Act, 1965 (2t of t965), the words ,,in (ash,, shdll bc deleted. 2 ly 0 r . y A '. p M p a l h ic ar a a t s i h o k n a o A f c A t c N t o t . o I I e I s of t a 20 b 11 l , sec, t 3 s ( i w n . c.f. 12-3-20 ).] in risci. rl(1)l If in any accountinB year an e mr.nt .rr.ll r(x.)i.rJ produced or manufactured by it or rendi rrrl: ,:n ioiih .'r,., establishment in private sector, and ihc inccnrr: frnm sr!ch sal€ rjr servic(.: or both is not less than h/r'enty percent. of the gross income of the establisfunent in public sector for that year, then, the provisions of this Act shall apply in relation to such 1. Subs. by Acf 23 of 1976,6ec. l3(a), for "(l) Subicct to the provisio.ns of tt\is section all amor:nts". Earlier section 19 was amended by Act 68 of t972, scc. .t(i) (w e.f. 19-12-19721_ 2 trrh"t{'diL,n! l:l {{' iil omitted b'l Aci 23 ot 1976, scc. 13O) (w.r.e f. 25-9-1975). Eartier ,rulLc,.(li1nr ilt td /;: were inJerted by Act 68 o( 7972, sec. 4(ij) (w.e.f. g_12_j972) 3. 5ulr-r|rrf.n iB,r Nr.rrttt\.. by Adt 55 of 1973, se<. 2 (w.t.e.I l4-t9731. Earlier suFscction ii ,virt ir:lrrtijd hr ict 39 oI 1973, *r.. 4 l!F.e.f . 14-t9?3). .l- Settion 20 re-numbered as sub.section (l) thcreof by Act 66 of 1980, sec 27-12-1sBX). Earlier the brackeh and figu-re "(lJ" were orni ed by Act 23 o{ 1976, se'c. 14(a) (w.r.e.l 25-9.197r, The Paymenl ot Eonus Act, 1965 lsec 20 cstablishment in ptrblic sector as they appty in relation to a like establishment in srtb-s{'ction { l). ntrthhrt: irl tili}i A{l 'h'lll r\, n{ llrtl tnlrnrj! drll] lo hr'!lt, 'llld 1l ll- ns lh.' Jplirofrli!t" ( '{l1fr]]n1t'lrl \: r!t(.rnNr!"rl {o drtr,t, i! slull trrur 'l r who shall p16r;9crl trl ror:(lvt'l lh(' iJlll{ t n'.l in the sarne manner as an arrear i"rfit""iade within one year from the lh* nnplol'*tl [r{)! lhe rlllplllt'1': lietn m.rv [rt- r'ntcrtlilrnl aitcr lhrr cxpirv roprirt{ i;o1'{:mmil!1t i:l s;1ti$fiilJ lhnt llr{: miking tht nFplii.ilirln rvilhrn lht' rrril iorc 22, 23, 24 and 251, "emPloYcc" ent of bonus under this Act bul who Act.-Where anY Pect to the bdnus Act to an esiablis rial disPute , or of anY Iial disPute aY bc, such ordinglY. COMMENIS LID nat ( ij i ) tu ln l d . t r v lit . r r, t r ', l . u lr s i t b n u d n l a T l ri h b a u s n l i l u . r| \ " l q g d g tc l t ) i' mI t L o L , S 2 ra 5 n 0 t ( i M nt a c d rc ) st on bonus award'irdi Panlv dispu it t if c il, ' ra ,un i t s <" ( 'd cL u ,v' n -x d p' c r" r t r* t r. h "t i r s r s r r i ' b cl u i'r n n; a . l n w F il " l i h 1 a i v i , i c " i , u ; r . i . s .r d ,,. i a c u h u o a n o n u ' E -' n ll F 1 l : o lT yt - c ll | , lr i r : ' 1 nn -i i!" ^ M 1 a : h :: n , m :: s . h i t P ro . : c : o ; - i - " 'd- r u; a ; -" i' r rt ' - , i a . : a - * r : r ^ s . n : - l * i ^n - u r " : r ^ in - ng teduit a rc c n c u L , r t a _' J c ., y ( t o s8 f 8 ') b b a 5a l 6l a a n Fn c lc-R e e - - s 2 s h 9 h e e e e e (B t t om aan ) nd profit and loss ',-+'n" ,n t , 0d " . tc i o i o " mt . p y P' ' "a " n f n ii"ets'-'-((1 l)) Wwhheerree'' during the course of trator or Tribunal under the Industrial Disputes AcL is. i -e; rtl ; oll"em im o ; en ' n ;tt i ; .o. f fd iinn ;; dd 1 rurss 4 lltr iiaa u ll n dd J ii z ,s;'"t""ed to the,"said i!i"l:l,:1,:':':lfjy i;;"";'..)iil; #..iri"i il1 t"ttion 2 1 2 s , h as beert re L f 'l e rred' the balance-sheet ';;;"i. 2- l. l i l , L n ' f , s * . r i . . , - . n . b .1 y l ; 1 , " r - A r . a , : d { - ! r 6 f r t 6 ' v :r ! e , o 9 ' r , f 7 c 1 . 6 1 r l e r m ' s 6 rl c r 0 r " l n , . : , d $ r - t e q 1 'i c i 4 ' { b t l l ' l : y ) ' ( A ( w r w r c r ' t r . ' e c ' 2 ! f l 1 3 . l T r 2 o : i 5 i ' i 3 ' - 1 q : 1 1 - i 1 9 ] 9 - 7 ll ' 7 6 . o 5 ' ) l s L: c .1 E c n a r l r r 5 l t i l e : ( r w :' s u r F ' : " s : f c r ,- i c - :5 l f i . o - . 9 n -, ' 1 1 { 9 2 ! 7 } 5 r w ] ! J n { s r : o l m :r it r l l c r d ': i|'*. ,'y 23 <tf 1976, s('c 16, for "and itr sections 2'l and 25' lwtel ^ 25 -^ 9- , 1 ^ 9 . 7 = t) , .4 Subs. Uv " ,q ., c r 66 of 1930 s!( 13, ft'r "\cction 25'(h"tc1 2l-li-I960) Soc. 251 The Paym€nt of Bonus Act, 1965 17 and fan corporation ora company (oth du , Comptroller and Auditor- Gen dul as auditors of companies und 226 he Companies Acl, 1956 (t ol 1956'), arc produced before it, then, the said arrthorify miy presume the statements and particulars contained in such balance-sheet and profit and loss account to be accurate and it shallnot bc necessary for the corporahon or the company to prove the accuracy of such statements and particulars by the filing of an affidavit or by ant' other modej Provided that where the said authority is satisfied that the statement and particulars contained in lhe balance-shect or the profil and loss account of the corporation or the company are not accurate, it mly take such steps as it thinks necessary to find out the accuracy of such rtatements and particulars. (2) When an application is made to t}le said authority by any trade union being a party to the dispute or where there is no trade union, by the ernployees being a party to rhe displrte, requiring any clarification relating to any il.em in the balance-sheet or the profit and loss account, it may, after satislying itself that such clarification is neces-sary, by order, direct the corporation or, as the case may bc, the company, to fumish to the trade union or the employees such clarification within such time as may be specified in the direction and the corporation or, as the case may be, the company, shall comply wjth such direction, COMMENTS The nuthoritv has to pre$ume lhe statemcnts and paaticulars conlaincd in the Balance-sbcct and the Ptufit and l,os,s Ac(ount lo be accurale unJcss the opposite parly applieli for cfnrificaHon; Wo*nen oJ India Ccwcnts Lli v. Indio Cemenls Lld,, (1984 57 Fl-R 349 (Mad) t[24. Audited accounts of banking companies not to be questioned.-(1) Where any dispute of the natur€ specified in section 22 between an employer, being a banking company, and its employees has been referred to the said authority under that section and drrring the course of proceedings the accounts of rhe banking company duly audited are produced before it, the said authoriry shall not permit any trade union or employees to question the correctness of such accounts, but the trade rrnion or the employees may be permitted to oblain from the banking company such information as is necessary for verifying lhe amount ol bonus due under this Act- (2) Nothing containedin sub-section (1) shall enable the trade union or the employees to obtain any information which the banking company is not compelled to fumish under the provisions of section 34A of the Banking Regulation Act,7949 (10 of 1949).1 25. Audit of accounts of employers, not beint corporations or companies.- (1) Where any dispute of the nature specified in section 22 between an employer, not being a corporation or a company, and his employecs has been referred to the said authority uunnddeerr tthhaatt sseeccttiioonn aanndd tthhee aaccccoouunnllss ooff ssuuccllrr eemmppllooyyeerr aauuddiitteedd bbyy any auditor durllyv oquuaalliiffiieedd ttoo aacctt aass aauuddiittoorr ooff ccoommopaanniieess under ssuubb--sse€ctciotionn ((11)) of section 226 of thc Companies AcL 1956 ('L of 1956), are produced before the said authority, the provisions of section 23, shall, so far as may be, apply to the accounts so audited. (2) When the said authority finds that the accounts of such employer havc not been audited by any such auditor and it is of opinion that an audit of the accounts I Ins, by Act 6tl oI 19E0, sec. 1,1 (w.!.c.f. 2l-&f980). Earlier scclion 24 lvas omittcd b) Act 23 ot 1976, scc 17 (w r.e.t, 25.9-1975). Th€ Pavment ol Sonus Act' 1965 lsec.25 18 is may' of such cmPloyer ttte may bv o.d.r, d'ireit tne such be spccttl('d ln. with auditor or auditors in dctnull ol *rrrh p;lvmenl shrll trt recov s, etc'-Ever1' employer shall preparc other docttments ln iuch form and in ernmerrt may, by notification in the thinks lil 16 be InsPectors for thc its within which they shall exercise iurisriiction ftt '"""ii'i i"' tn.p*ctor appointed under sub-sectiotr (1) may' -t1"-n:jqw:]:r:t.n " - t asceri"ining whether any of the provisions of this Act has bern compltccl (a) requrre to fumish such information as he may consrder "n "rnptoyt:i (c) Iound in charge of the e therewith or ;n,1' Pcrs0n \{' believe to be or !o ha ve bet: ff (d) make coPies of, {elitl c:( document m,'ifltiinrd tr. t* ,, -"" be prescribed. to be a'public servant within thc mcaning e any accounts, book, register or othcr Inspector under sub-section (l ) shall De l l'e' r "g " - " aii k lily5 i i ib . ; o- ; 1u ; '. ; nr ; od ; t t y t t l o " g d c o o o n s t o a f ' i u n m ed is i h n o th r i s d s is e c c l t o io s n e s a h n a y ll s e t n a a te b m le e a n n t I o n r s p in e f c o to rm r t a o t i r o e n q u o lr r e lo a '1. lns bY Act 66 of 1980, scc 15 (w.re.f 21-8-1980) Earlier sulr-scction (5) wns omitted by Acl 23 of 1976, sec. lE (w i.e.l. 25'9'7975) Sec 3Ol The Payment of Eonus Aca, 1965 19 prduce, or give inspection of, any of its books of account or other documents, which a banking company cannot be compelled to fumish, disclose, produce or give inspection of, under the provisions of section 34A of the Banking Regulation Act, 1949 (10 of l9a9).1 28, Penalty.-lf any person- (a) contravenes any of the provisions of this Act or any mle made thereunder'; or @) to whom a direction is given or a requisition is made under this Act fails to comply with the direction or requisition, he shall be pr.rnishable with imprisonmenl for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both. 29. Offences by companies.-(l) If the person committing an offence under this Act is a company, every person who, at the time the offence rvas committed, was in charge of, and was responsible to, the company for the conduct of business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub-section shall render any such person liable to any punishment if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such oflence. (2) Nofwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that thc oflence has been committed with the consent or connivance oI, or is attributable to any neglect on the part of any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explnnation.-For the purposes of this section,- (a) "company" means any body corporate and includes a {irm or other association of individuals; and (b) "director", in relation to a firm, mcans a partncr in the firm. .A crircctor or a company ."*", o":fl}1l5T,,tnta companyj si?'rh s'th chcnt.t v Laboul ca tt, (19E6) I LLN e3l. 30. Cognizance of offences.-(1) No court shall take cognizance of any offence punishable under this Act, save on complaint made by or under the authority of the appropriale Government l[or an officer of that Goverrunent (not lrelow the rank of a Regional Labour Commissioner in the case of an officer of the Central Govemment, and not below the rank of a Labour Commissioner in the case of an o[ficer of the State Government) spe€ially atrthorised in this behali by lhat Covemmentl. (2) No court infcrior to that of a presidcncy magistrate or a magistrate of th€ first class shall try any offence punishable under this Act. l- lns lry Act 66 of 1980 sec. 16 (w.r.ef.21.8-19E0). 20 The Payment ol Eonus Act, 1965 lsec. 30 (r) rhc p(,rn d of limitation f". fltt'tgc:#il^1[S,n c,ir,.innt court is thc !ianr(' ns hls bccn sp( (ili(d tn section {69(l)(a) of the Codc oI Crimirl?l Prcrcdrrre, 1973; AL'n|h D?r.lop'tu:nt (:o Lhl \.5t tu oI Mdharnihtn, (f98E) 57 Ft.R 548 (&,m) (ii) Ihe Latour (rmmrssioner is emF)lv.rod to filc comphi|lt$ for proseclting offendcrs Also, h(. c.rff nuthorNe n thrr.t partv to do so;,4.nnt Dtttlopmnt Co l.ti v Slnt? of Moh.troshtm, (1983) 57 Irl.R 548 (Bom) 31. Protection of action taken under the Act,-No suil, Dtosecution or other lcgal proceeding shalt lie ag.rinst the Covenrmcnl or ;ny officer of the Covornment for anything $'hich is in tood falth donc or intended to be done in pLrrsuance of this Act or any rule made thereunder. r[31A. Special provision with respecl to payment of bonus linked with produ(tion or productivity.-Notwithstanding anythinB contained in this Act,- (i) whc,re an agreemenl or a setflement has been enlcred into by the employees with their employer before the commencement (,f lhe Payment of Bonus (Amendment) AcI, 1976 (23 t>I 1976), or (ii) where the en'rployees cnter into any agreemcnt or scttlement with their cmplover afler such commencement, for payment of an annual bonrrs linked with production or productiviLv in lieu of bonns based on profits payable rrnder this Act, then, such employees shall be eDtitled to receive bonrrs due to thcm r.rnder such agreement or setllement, as the casc nray be: r[Providcd that any such agreement or settlemcnt whereby the emplovees relinquislr their right to receive lhe minimum bonus under section'10 shall be null and void in so lar as it purports to deprive them oI such right:l jJl)rovided frlrther thatl such employees shall nol be entitled to be paid such bonus in excess of twenty per cent. of the salary or wage earned by them d[ring the relevarrt accoLlnting year.l 32. Act not to apply to certain classes of employees.-Nothing in this Act to- slr.rll applv (i) 1[*--] employees employed by the Lifc Instrrance (iorporation of Ind ia; (ii) seamcn as defined in clause (42) of section 3 of the Merchant Shipping Acl, 1958 (44 of 1958); (iii) employees registered or listed under any scheme rnade under the Dock Workers (Regulation of Employment) Act, i948 (9 ol 1948), and employed by registered or listed employers; (ir,) employees employed by an establishment engaged in any industr_y carried on by or under the authority of anv department oI the Central (lovernment cr a State Government or a local aullrorily; (") emplovee.s employed by- (a) the Indian Red Cross Society or any nthcr instihrtion of a like natLrrc (inclnding its branches); I lns hy Act 2j of 1976, sec- 19 (w r r.f. 231-1975). 2. lrls by Aci 6(r of 1980, sec 17 (w,r c f 21-8-1980), 3 Subs by Act 66 of 1980. sc(. 17, f(r "Provided that" (rv rc.f 2l.5-1980) { Thd h,orcls "emplolces culployed by nny insure( carryin[i or] gcncr:rl inr^urancc I'usincss .l|\d the" or)litled bv Acl 62 oi 196ti, sec.41 Sec 321 fhe Payment ot Bonus Act, t96S 2l (b) universities and other educational institutiorls; (c) institutions (including hospitals, chambers of commerce and social welfare instiiutions) established not for Furposcs of profiU '[-*] ,[*.] (viii) employces employed by the Reservc Bank of India; (ix) employees employed by- (a) thc lndrrstrial Finance Corporation of India; (b) .rny Financial Corporation establishcd under section 3, or any Joint Financial Corporation established under section 34., of the State Financial Corporations Act, l95l (63 of 1951); (c) thc Dcposit lnsurance Corporation; 3[(d) thc National Bank for Agri4ulturc and Rrrral Developmenb] (s) thc Unit Trust of India, (f) thc lndu-strial Dcvelopment Bank of India;

{[(fa) thc Srnall Indrrstries Development Bank of tndia established under scction 3 of the SmalI lndtrstries Development Bank of lndia Act, 1989J s[(ff) the National Housing Bank;] (g) any other financial institution 6[(othcr than a banking company)l/ being an establishment in public sector, which th; Ccntral Govcrnmcnt may, by notification in the Official Gazette, te spt'cify, having rcgard (i) its capital structure; (ii) its objectives and the nature of its activitiesi (iii) the nature and extent of financial asslstancc or any concession given to it by the Government; and (iv) any other relevant factor; 7[*"1 (xi) employees employed by inland water transport establishments operahng on routes passing through any other country. COMMENTS (i) Appcllant lvlcdica) Collcgc.rnd hGpih'rl was hcld ro bc nr,ithrr irn edrcatior[l instikrtion comin8 undcr s4ction 32(vxb) of thc Paymt'nt o/ Bonns Act, l9(5 nor n hospital which was run on a non-profit basis; CrriJllr[ Mtdiinl Colk|t nnd Hospitol e pr(rrdfir.{ OlltL,r, hld slri.ll T bt lnl, Mdns, 2tn3 (lll) LLJ 650 (Mad) 'I C-la($c (vi) omittcd by Act 45 of 2007, sec 4 (*..rc.f tl--44--22000055)).. CCllaauu<scc ((vvri)),, bI'ccffoorrcc oommirssssiioonn,, stood as undcr. "(vi) ('mpl(,yccs employcd through contractors orr buildin8 operatnns,,, 2 Clause (vii) omittcd by Act (# o/ 1980, sec t8(a) (w.r e f 21-8-l9BO). F_arlic,r cliru$, (vii) was snbstrluted by Act 23 of 1976, scc 20(a) (w re.f 2t9-1975). -3 Slrbs b) Act f,1 oa l l, scc- 6l nnd Sch ll. for sub-clarrru (d) lw.c_f l-tt9lt2) lltq- by Acr 39 ol 19E9, sec. 53 and Sch. II ($,eI 7-3-1990), Ins by Acl 53 of 1987, sc. 56 and sch Il (w.c f- 9-7-1988). Earlicr sub,clausc (ff) u,as ioserted by Act 23 of 1974,, !rec. 20(bxi) (wr.ct 2U9-19?5) and wa$ omittcd bv Acr 66 of 1980, tr,c I8(b)ti) (rv.r c f 2l-8-1980) 6_ hr,r by Act 66 of 1980, scc. lE(bxii) (w.r.c f 21-8-1980). Earlior the words,,(,rher rhan a banking compnny)" wcr€ omithd hy Act 23 oF 1976, lr:c. 20(b)(ii) (wj.a t. Z5r)-t975) 7. Cl us. (x) (,mrttcd by Act:3 of 1976, s€c 20(c) (w.rr.f. 25-9-1925) Tha Pavmenl ol Bonus Act 1965 lSec 32 (ii) Tamjl Nadu Watt'r SuPPly and Drarrnge Board is an institution-cstabLshcd for the o ii r , .r , r i p , o i s i c " s , t o l" f 'w pro n f t it t . , lt s u |s p , i 't t v h e o re m fo ! re L , r a n m o n t 1 c ( x c E lu c d a c rd d e fr o T m d th n c P N r n e l v u ic t w t't n o te f r s S €ct r i 4 o t n p lv 3 ' 2 tn r ; r ) D ( r c a ) n o a I g l a h e k A n ( n t, l -E n ^ r t'itu.trilc ' i A " s .f s * o " tt lr i c f n .' , " . 1 - 9 l" 9 g 8 L n L o R "' a 4 1 c 7 annot bc rrcltcd to bc * local authority within the mcaning of scction !? f (i.'j of thc Act; Forlsui.q Boad oJ Llaryuna v llnry'1te Hot/nng Board LmPlcJeB Llnion' AIR t996 sc 434 (i") lnsfitutrons desiSncd for cnrning prolit should Pay the rhirimum bonu6 io their ernpl'r''ees; fn iitfi ii,ppty C' orni'nage ao,,,a Engini"s Assot'auin v Goocrnnotl o/-fomtl Ndd'r' (1991) I-LI " 19{ (N i1 'la 'r d ) l . lrF i,r i:. rrL't,lfplr1:ltr tr) 't{enF !!t Sute (ii;r{rI.rr:nr;: '{ lrl'r"rrji'r'r r}'l- | r'll t , g ,, E ,'" l . ' r 5 '1 '; C , , ' i i , 9 , 5 l , r 1 ' l ; r , l ' r . r ' r , t '. lr , ' ' i , r ; * 'I . s r r l u r lr u : r r r r ir r h s u .r r l i! r ; r rr il ' i 3 1 s ' : r ' i l i ' r i j r l * r r r li '! r n r " ; " ? lr { r $ ri } l ' h r rl I i t l' ' " t r r i r 'i _ i1 !r r ii i \ n fi r : ' n ;': ! l l r ! 'r r \ i 'l L i r - l L i: l l u 'l' l ': t r 'j ' r t 'l ' ' " r t '1 ri 1 ' I l,t-J 162 (Rom) (DB) 33. Act to aPPly to certain Pending disputes r€8-ard^ing PllJnent :l bonus.-[Rr7. bv ihi' i'nymutt of Botrtts (Amenrlnettt) Act' 197b (23 ol 1976)' \t:r 21 ku.r.c.f . 25-9-1975) | r[34. Effect of laws an the Act'-Subiec{ to lhc Dlovisions of sectron ct shall have effect r"ii,r..irlJi"r i. arry othcr law f.r ii ;.i ["t^g ?" " f " .i y rc i e t t o , "r " i g n the terms ement' settlemerrl or " contract o[ servicc. Saving.- ] Nothint be deemed to alfcct thc 35. ,'rro,r-i.ioni oi itre Coal M"l,t us Schemes Act' 1948 (46 of t948), or of any scheme 36, Porver of exemption.-lf the a mment' having I"g'19 !: ,f.,., fi.rnniiot gositi(,n a;d other relevant circttnrstances of any establishment or c : n l i a i ; i s : n s ;' . ; o ; f o' ; ,n' e i , i s !u t t h a o b ; f ; , th tt c s p . rov , i s iiss io oo n ff s oo o ppii f un t iioo h nn ;t tt a hhaa c tt t ii r tt h ww er iill c ll l o nn , oo tt i t bb ec 1 ii a nn y p P ' u b u b b y l l i i c c n o iinn ti lt f ge ic rre a e.s t s r tt o tt n oo r aa n PP PP th lyy e - l , j ': i '. r , i : . ' i . " i aj"*,i",-"i"rnpi r..-tu.r' -p,e,-rii,o,,r.Jr a-cs hm.rwy l b a e csp 'eoi"r'ffr'eodd. tthheerreeiinn aanndd ssuubbiieecctt 'lo^ .s,,n.chh .c^o,rn,d1t tir<i..lrnnqs ;arss iitl mmaayv thinl fit to ' , * * p o o o i i " ", , ttrriihh eessttaabblliisshhmmeenntt oorr ccllaassss ooff .rroblirh^.nt ' . from all or iny of the provisions of this Act' COMMENTS ;i' 't '- i: ( l i ' ; ) ; ; i l , t ; t t " h : e , , , ; G ; . ; ' o - ' v j ' e ; '; r ; n ' i i r " " n " i c " n i , i t , , J h ^ a ,l " . t ' l r ' ' x " , c , . " r n c i, is * "p t a d p i f i l o r ia v w ri t r o h :r e t s r e t t m s 'r t r d ' r t e t h r r l c s s h s c n r c n m ti e o e n r r ' t " 3 6 ' " ' o " ' f ; j" t h : . c " ' ' " , A " c . ' t '' i : ' i : - n ' " . t O ' i '? ' l : ' : q : I l l n l : l : / t s : ' 1 d * f , j ' l s l : : i 'I ' v l' cl in sectror ir.r: {ri: l" 1* rirr'i a illr thlr firflnlhl c, and thcir othcr circunrslnnccs havo to b('$({n iate Covernrnert to fo(nr its oPinlon ulrdcr SlnlealTanil NaLlu v K Sdl''hdvaSutr' AIR lc96 ( 5 ii C r) 3 F 4 o 4 r . xranting exemPtion to any establishmenl, the Government has to Pas'\ r sPeakIIrB orde. l ; l 'i N l- s t l l i " o " n f o ,' l D tt a D '', Y ,i oD"t*utcoliooPn eennlt Bari ,v.. NNaalliioonnaall DDooiirryy DDaclv''.lolopptn eennll EEnmpploloyy&&'s's' ' UUnnioionn (1986J 2 t.LN 146. iiuioef,rr. acco.airlg exemPtion under section 36 to an c'stablishmur(' its emPloyces shorrld bc he^td i, ; Sttli.t.lie" oofl Troannttl Nair uu KK.. SSoobbaannaayvaaggaamn && fT NNSS.HH, 8B .' 00998899)) 11 ll''ll''NN 995555 (Mad) i" Si,u..-itv e.i-zl "l 1976, scc 22, for section 3{ lw r'e1 25-9'1975)' Sec.401 The Paymsn! ol Eonus Aci 1965 (v) The appropristc Governmcnt must considct relevant factors bcfore it chooscs to.lccord exem 3 pl 7 io . n ;_ P f o N w . S e ta r t ( t H o o u r s e fig m B o o v ar e d v d . i K ff . ic Sa u b l a ti n e a s ln . g - n [ h R , c 0 p 9 9 . 0 ) 6 b l y FL . t R h 6 t 0 , ( p S a um rlu nu e ry n ) i ( o Ma f d ) 'B . onus (Ampndmmt) ALt, 7976 (23 of 192 , set. 23 (u,r.e.f. 25.9 lg\il.l' 38. Power to make rules^-(l) The Central Government may make rules for the purpo.se of carrying into effect the provisions of this Act. (2) In particular, and without prejudice to the generality of ihe foregoing power, such rules may providc for- (a) the authority for granting permission under the proviso to sub_ cfarrse (iii) of clause (l) of section 2; (b) the preparalion of registers, records and other documents and the form and marner in which such registers, records and documents may be maintained under section 26; (c) the powers which may be exercised by an inspector under clause 1e; of sub-s€ction (2) of section 7; (d) any other ma er which is to be, or may be, prescribed. (3) Every rule made under this section shall be laid as soon as may be after it is made, before each House of Parliament while it is in session for a total period of thirty days, which may be comprised in one session llor in two or more successive sessionsl, and if before the expiry of the session 2[immediately following the session or the successive sessions aforesaidl, both Houses agree in making any modification in the rule or both Houses agree that the rule ihould not be made, thc rule shall thereafter have elfect only rn such modilied form or be of no effect, as the case may be; so, however, that anv such modification or annulment shall be without preitrdice to the validity of anything previously done under that rule- 39. Application of certain laws not barred.-Save as otherwrse exDresslv provided, the provisiors oI this Act shall be in addition to and not in der6gation of. the Industrial Disputes Act, 1947 $a oI 947), or any corresponding law relating to investigation and settlement of industrial dispuies in force in a State. An exercise to identify a person a. *"ffa*:il"T,", enrued ro bonus under a covcrnmenl Resolutior wrs wilhin the iurisdiction of the l-abour Court urder scchon 33C(3) of the lndu-strial Dispules Act,7947) SlatL,ol Mahanshtrc v Qnadat Mohd Finjan,2U)2 (2) LLJ 1024 (Born) 40. Repeal and saving.-(l) The Payment of Bonus Ordinance, 1965 (3 of 1965), is hereby repealed. . (2) N_otwithstanding such repeal, anything done or any aciion taken under the said Ordinance shall be deemed to have been done or taken rrnder this Act as if this Act had commenced on the 29th May, 1955. 1 S bs by Act 23 d 1976, sec 24(a), for ,,o. in two sr.rccessivc scssions, (w.r-c.f 25-9-1975) 2 Srbs. by Act 23 tt( 1976. scc 24(b), for ',in which it is so laid or the session immedint(,lv foUowing" (w.r,e.l 25-9 -1975). I 24 Th6 Payment ol Bonus Act, 1965 lsch. 1 ITTHE FIRST SCHEDULE ls?e section 4 (a)I COMPUTATION OF GROSS PROFITS Accounting year endin g..,,,.,,,. ilfrlr Parliculars Amount of Amount Remarks sub-items of main :1:ir itens Rs, '1. Net Prcfit as shown in the Profit and t oss Account after making usual and necessary Prov$lons. Add bdck ptovisio torl (a) Bonus to emPloyees. b) Depreciation. (c) Development Rebate Res€rve Ser foot-note (l) (d) Ary other reserves. To[al of ltem No. 2 Rs. sde foot-note (l) Add bad< alscl- (a) Bonus paid to employees in resPect of previous affounting years. Sce foot-note (1) (b) The amount debited in resPect of gratuity paid or payable to employees in excess of the of- aggregate (i) lhe amount, if any, Paid to, or provided for payment to, an lpproved tratuity fund; and (ii) the amount actually Paid to employees on their retirement or on termination of their ernployment for any reason. (c) Donations in excess of the amount admissible for income.tax. (d) Capital expenditure (oth€t than Scr foot-note (1) capital exDenditure on scientific research which is allowed as a deduction under any law for the time b€int in force relating ho dir€ct taxes) and capital losses (other than losses on sale of capital aisets on which depreqiation has beefl allowedfor income-lax). (e) Any amount certified by the Reserve Bank of India in terms of suFsection (2) of s€ction 34A of the Where the prolit subject lo taratim is shown rn the Profit and l,oss Account and thc provision mlde for taxes on income b shown, the actual Provision for Laxcs on incohe shall be deducted from the profit. l. lns. by Act 66 of 1980, sec. 19(b) (w.r.e.f 21-8-19E0) Earuer the First S.hedule was omitted by Act 23 of 7976, 6ec. 25 (w.t.e 1. E 9-1975), - Scft 1l The Payment of Bonus Act, 1965 25 Item Particr ats Amount ot Amount Remarks No. sub-itemg of main items Banking Retulation Act, 1949 (10 of t 7949r. I (0 Losses of, or exPenditure relating to. anv business situated outside - lndia. Total of Item No- 3 ....... Rs Add dlso incor''e, profits or Sains (if any) cr€dited dircctli to Published or discloded r€serves, other than- (i) Pro-fits sate of which allowed for income tax); (ii) profits ol, and receiPts telatin8 to, anv business situated oubide [ndia; (iii) income of forci8n banking companies from investment outside lndia- Net tolal of ltem No. 4 -....-'-. . lc\- 5. Total of ltem Nos. 1, 2" 3 and 4. .'. ' R5. 6. Defu$t: (a ' ) Capital receiPts and caPital Pto-fits Se? fooFnote (2) (other than Profits on the sale of assets on which dePleciation has been allowed for incometax). (b) Profits of, and recelPts relating to, Ses foot-note (2) anv business situated outside lndia. I (c) lnio-. of fro fo m rc ign banking See foot-note (2) companies inve8tment6 outside lndia. 1 (d) Expenditure or losses (if anY) debited directly to Published ot disclosed teserves, othet than- (i) capital exPenditure and capital losses (oth€r than iosses on sale of caPital ass€ts on which dePr€ciation has not been allowed for incometax); (ii) tosses of any business sih.rated outside India. (e) In the case of foreign banking Ser foot-note (3) companies ProPortionate admini+ trative (ovLrhLad) exPenses of Head Office aUocable to Indian - F The Pdyment ol Bonu€ Acl, ,65 lsch. I Item ParticulatB Amount of Amount Remarks No. sub'iterns of main ilerns (0 Refund of any exc€63 direct tax See foot-note (2) paid for pfevious accourting years and excess provision, if any, of previous accounting years, relating to bonut dep.eciation, or develoP' ment rebate, if written back, G) Cash subsidy, if any, given by the 5€d ioohnote (2) Goverun€nt or by any body corporate established bY anY law for the time being in forc€ or by any other agengf through budgetary grants, whether Siven direcrly or through any aBency for sPecified purposes and the Proceeds of which are reserved lor such PurPoses. Total of ltern No. 6....,. 7. Gross I'rofits for purposes of bonus Rs. (It€n No. 5 minus ltem No. Exphnqtion.-ln sub-item O) ol ltem 3, "approved Sratuity fund" has lhe same meanin8 assigned to it in clausc (5) of sedion 2 of the lncome-tax Act. Firot note6-- (I) 4 and to the extent, charyed to Profit and tn65 Accorht- (2) lf, and to lhe extent, credited to Prcfit rnd [,oso Acaount, (3) In the proportion of India-tr Gr6s Proflt (ltem No. 7) to Total World Grosc Ptoftt (as Fr Consotidaed Profit and toos Ac(ount ldiu6ted ac in Ilem No 2 above only) l SECOND SCHEDULEI '[THE rtSac section 4(b)l COMPUTATION OF GROSS PROFITS Accounting Year eading."'. . Irarticulars Amount of Amoun! Remarks eub-iterns of main Iterns Rs. l. Net ftofit as per Profit and Loss Account, 2. Add back provision lor: (a) Bonus to employees. (b) i-ic;,r',,< :.rlrL'rr fn" Fiar S"f,"aU" --"u-leted at the Sccond Sch€dul€ by Acl 66 of 1980, s€c 19(') (w-r'e f 23 0l 1976, Earlier the the wotde "(5?. scction 4)" (w,t.e.t. 8.9-1975r, Sch.2l The Paymant ot Eonus Acl' 1965 Item Particulats Amount of Amount Remarks sut>ilems of main No. rtems Rs. (c) Direct taxes, including the provision (if any) for Prcvious r[(d) a D c e co v u e n lo tin P g m Y e e n ar l s . reba te / lnv€stmert S€c foot-note (l) allowance/DeveloPment allowance reserve.] (e) AnY other reserves. See footsnote (t ) Total of ltem No. 2... . Add brck alu:: (a) Bonus paid to employees in respect Ssr fooFnotc (1) of previous accoundnt Yeals' ,[(aa) Thi amount debiled in resPect of gratuity' Paid or PaYable to [mplofeo' in exc€ss of the of- aggregaae (i) the amount, if any, Paid to, or emPloyment for anY reason l (b) Donations in excess of the amount admissible for income't'ax' (' c') AnY affiuity due, ot commuted valie of anY annuitY Paid, under the Drovisions of section 2E0D of the lncome'tax Act during the accountlnS year' (d) iture (other than Sce looFnote (1) ture on scientific is allowed as a r anY law for thc tim€ beint bxes) and lossgs on which d allowed tot income lax or aqricultural income tax). (e) I-iss€s of, or expendilure relating to, any business situated outsid€ lndia- Toral of ltem No. 3 . l'*';'^f f ?i,'#:f1,ti"li-';I:sl';i1,1"'"'21'8-re8o) Tha Payn ont ol Eonus Act, 196g lsch.2 Iiem Parliculars Ahounr of Amount -_- i;;*; " No. sub.items of main R,i 4. Al.d also itrc!/i\e, pmfils or gains (if any) credjted directly to rCserves, ollrcr than- (i) capital receipts and capihl. profits (including prolits on the' ;le of capital ass€ts on which depreciation has not been allowed for incomc-tax or agricultural Income-tax)j (ii) (iii) Net total of ltem No. 4... Total of ltem Nos. t, 2. 3 and 4... Deduca: (a) Capital rec€ipts and capital profits (other than profits on'the sale of S€e foot-nore (2) assets on which depreciation has been allowed for income_lax or agricuhural income-tax). (b) Profits of, and receipls relating ro, Sde foot.note (2) any business sihrated outside India. (c) lncome oI loreign concerns from investmen!s outside lndia_ S€€ foot-note (2) (d) lr.pm{iture or tosses (if any) debited directly to reserves, ottsr thon- (i) ca pi ta l. cxp€nd i t u re and capital losses (other than lo6se6 on sale of Capital assets on whrch depreciation has not oeen allowed lor incorne.tax or agricultural rncome.lax; (ii) loss€s of any business situatcd outside Indra. (e) In the ca6e of foreign concern5 prioportionaie administrative (over. Ser foot-note (3) head) expenses ol Head Office allocable to Indian business. (f) Refund oI any direct tax paid tor See loocnote (2) prevtous acrounting years and qrcetlr Pto!lljiDn, il {n}, oI prcviotr$ ikco{rnling vrlis rclabng tf' bonuti, di,ffcct"rtrrrn/ taritti(Jn ot dsvsh)r! rel'alr or T:nl devclo1,m,rn1 tll)rt,rn{r:, if rr'tiltr.n bach, ."--*** Sch.3l The Payment ot Bonus Acl, 1965 ZY Item Parliculars Amount of Amount llemarks No, sub-iterns of hain llems Rs. t[(g) Cash subsidy, if any, given by the Governmcnt or by any body corporate established by any law for the time beint in force or by any I other agency through budgetary granls, wheth€r given directly or through any agency for specified purposes and the proc€eds of which are reserved for such purposes.l Total of Item No. 6... Rs. 7, Gross Profit for purposes of bonus (ltem --====:= No, 5 minus ltem No. 6) Rs. zlExplanalion.Jn sutsitem (aa) ol llem 3, "aPProved gratuity fund" has the samc meanin8 assigned to ir in clause (5) of section 2 of the U"_9Ia!.1I-"4S|L***"."- Foot-notes.- (l) lf, and k, thc ertenl, chatgcd to Ptofit and Los$ Aocount (2) lf, and to lhe extent, crediH 1o Profit and l,ocr A.count. (3) In thc proportion of Indian Gross Pmfit (ltcm No. 7) 1o Tolal World Gnrs.s Profit (as Per Consolidoled Profit and Loss Account, adiuslcd os in llcm No 2 above only) {IHE THrnD SCHEDULEI [See sectron 6(d)l I alcompany, other than (r) The dividends Payable on ilq banking companyl Drejer€nce share capital for the iccounting year calculated at the actual rate at which such dividends a!e payablei (n) 8"5 per cent (/f its paid uP equity share caDital as at the commencement of the accounting year; 0ii) 6 p€r cent of its reserves shown in its balance-sheet as at the commencement of the accounting 1 Sub$- by Act 23 of 1976, sec. 26(d), for sub-itcm (g) (\! r.e1 25-9-1975)' 2. Ins by Act The Socontl Act 66 of 1980, sec. 20 (w r'o t 2l-8-1980). " wns subslituted by Act 23 of 1976, sc..z @ tef' 25-9-1975) Subs. t'y Act 66 oJ 1980, $:c.20{.), for "CQmPnny" (w r'"'.I 21'&1980) Earlier the wonls ", othc'r tlrian a l,anling cornpany" we.e omitted Ly Act 23 of 1976, sec 27(b) (w r'e f 25-9-1975) 30 fhe Pawant ot Bonus Ad, 1965 ls€h,3 {li yeat including any prolits carried forward from the Dlevious accoun ng year: di.,.d lhdi r{. h.crr thr,. empl(tvcr ji, d ,mpnr}f !"il.hiF lh{ meatling rri | ,lt th!' (i)mF,uri,'\ A.t, l,r\, il .,1 19,i61, th(' ttrtdi nmounl h: lrrr dqrlrrclad trnder thi:; ttpm,th.rll be l| q t*. crrnt on fhe ngdregntd rll the v;!lur. ol the nr+ firort a.sErs dnd lhe {ltraent a*1r't\ tt lh{' cornpnn! irr hdrr aftr-r dr.dufhng rhc ,rrnorrni ,,i rr, !"une.tt liirfriltlies {irther thrn rn!' dn]r}unt Fd.l.n Cl)mF,!n! t(1 ttt ivh cg tils ,rdr"rrl(r {he ll {rr o "r t a n lv e rl\t:{,.t any interest pajd by the company to irs Head Of6ce) in lndia. '[2. Banking company (i) The dividends payable on its preference share capital for the accounting year calculated at the raie at which such dividends are pnyable; (ii) 7.5 Fr cent. of its paid up equiry share capital as at lhe commence. rnent of the accounting year; (iii) 5 per cent. of its res€rves shown in its balance-sheet as at the com- mencement of the actounting year, including any profits carried forward from the previous acc- ountrng year; (iv) any sum which, in respect of the accounting year, is transferred by It- (a) to a reserve fund under sub- s€ction (1) of sectjon 17 of the Banking Regulation Act, 1949 (10 oI 1949L or (b) to any reservG.s in India in pursuance of any direction or advice given by the Reserve Bank of India, whichever is higher: Proeided that where the banking company is a foreign company within the meanin8 of section 591 oI the Companies Act, 1956 (1 of 1955), the amount to be I lns. by Act ('6 of 1980, sec. 20(b) (w-r,e.f 21-8-1980), E6rlie! irern 2 was om ied by Act 23 oI 7976, Eec. 27(c) (w.r.e f 219.79751. The Paqnent ol Bonu6 Act, 1965 31 Sch 3) deducted under this ltem shall be the the same re(erence wolking rLs total world working funds; 3. CorPoration 4. Co-oPerativesocietv F!;G? 32 The PaynAnl ol Bonu6 Acl, t 5 i:l: operative societies for the time beint in force. 5 Any other employer not falling E.5 per cent. of th€ capital inv€sted under any o( the aforesaid by him in his establishment as c6tegoItcs. evidenced from his books of accounts at lhe commencement of the accounting yea!: Fmlrded llr;rt *'hqr*.quch t'nrplovcr i.r ;r F4.r|nrn r0 {ahom t:h}pl{'r XXIIA tri the Incomc-lal Act opFlir{s- tlrc aFnu;t} tlep$rii p+1,"rtrlr bv hinl urtrlrr th prrlvi\itnrs af lb.1t (luprtr5 ;1x;;rt* lh(: ar.!]rrntlng yrir slull illS{j L}lj d0tlrk:lirJl lltr:r{drd iurthrrr lhilt wlvr'l .||th ,: n il rrn{)un{ {'(lu'rl ld J-1 ul thu .rr:riiLr rlt"rived frv rt est bl t il1 rr*lL|ct Llf tilr lvhrr, thr l!.lllncl\lltl',) nt, !i hclhet rrr.tl.rr r\'rlllCn, Frnr idr* F,rtfilrnl ui f,cmuneralitrn lo dnl'srrch pilrtn€r, ,rnd* iirl lhF Intll r{r!!u|1!rrlrin tlirl bl\r lr! ,rll ,'uch F.rrinqF r:. hiFh{! lh^n l,rc s;trrl ?5 ;.t'r (*nt. itt{h pi:rupntngi:- rrr a rttnt r,rlr.rLl,rlrt{ nt lh('1il[i o! ''t$Aht I tl-' !ll(:tr F t rlt rh{ll hi" thir provjso: Provided also that where such employer is an individual or a Hindu undividecl famrly- trl l tr l: .il{lrr J{'ductlnri ilc|n {'rirtilr1 ir'l trcitrdirde* u ilh lhe lfr.lv|9!{rfis ,rf cldr(|ii. ld) {r{ at{lir'ln ir: or (ii) forty-€ight thousand rupeet whichever is less, by wdy of remuneralion to such emDlover, shall ilso be deducted. Tha PaYment ot Bonus AcL 1965 33 (3) (1) (2) Any emploYer falling under 6 Item No. I or ltem No l or ltem No,4 or ltem No 5 and being a licerLsee within the m€aning of the Electricity (SuPPlv) Act, 1948 (54 of 194E) Explaflntion.--Ttre exPressio i n n r c cs t e r rv i e * s i " l ; o : c n ctt : rr : in ; g , H il l t j t l - l ll l u .")l- lll aSainst ltem Nos 'rur,ii,ii,Lii".a 3(ii)r sh'an not i:i*1,il:!l'"*?t,, o" (r) p.lyment of any direct ta (,,) P"iIXbl; r"y d"Preciation admissible in accordance with the provisions of clause (a) of section 6i tiiil i'ly^u"iof dividends whiclr have been declared' t,"t tttilliitXd,f."nt' over and above the amount referred to in clause (i) of this ElPlntntion' set aParl as 'p"tiiit '""ttu" for purpose of Payment of any direcl rul l1l ""f.'", set aPart for me€ting anv dePrec';'119i-'-',:l::* or the amount '" ;;"^;;ibt" i" *ittt th""p'otisiots ttf clause (a) of section 6' "..o'tdontu ,[THE FOURTH SCHEDULE (S(f section 9ta the oft i!ii'' at t t o o s '. i t x t t t y "q P , e ," l t Amo a u s n b t o P nu a s yable c o t S f r f t r l i t o e o f d n t h fo o e r r w Y s a e e a r t d r C- T a o o tl t r ic a d s l e s f t e o o t r w f o f n ard cent- or sixty- seven Per cenl irs the case may be, or available surPlus allocable as bonus i4l .:l i,'; Rs. Rs Nil Rs. Nil li. nl , 1,.rr.l 'r,04,167" 1 1,04,167 Set on Set on 2 5,35,0fi) 2,s0,000- 2,50.000' 2,50,000- 12) Nil S)t on 2,20,000 2,50,000{ 2,20,ffi (2) (in(lusive of 30,000 from yeat'2) ; l ; : . : ;ut rrl 19E0, soc 20t.i' l'' l r u ' ; l t ( ' ' 'l t 'i : : Earlicl the words \,i1.\. $;rted bY Act 2J {}i r t*-ll ',:.1 ,tfrtJ;lt}:li ,'r 1960,s.c'2l,t"r n Lr.rj "ubstituted trY \' I j i r 23-9-1975) fltc W ot &fln Aq tc66 ql Set Set on r25,ql0 2,mN (2) r,8M (4) 2J0,m0" Nit $et or (iEhEivr ot t,lorm t,t0& e) &om yeen2) rfi/Ip (.) 3,10/0q) e50,m0. S o e r t u on Set dr Nil+ e, 1,Em (o @,w (6) 2,9,w 1,(xrx00 ol Sat (irdndv" of 15n00 30rq) (6) ftom )'€15{ .nd 25"00 freur Fr{) MI tptl6P (du. to lor.) lncludvc of illl,Om 9 69 !t , t6 o 7 tr S @ Gt , o 1 ff 6, (8) from ycrn6) ' \w$r t0p@ Sei off E* off 9+167 e,167 (E) *167 (e) 2,1ttfr N Set off (rftrr rcttilg o,fi 52501 (e) 69,167 hom y.it-.E |nd 41,666 tlom NoE F ' Mrxit |n o + l I d h D c i b D a | tr | n !! c ] e of Rr, l,l0pO rct on ftoo yrrr"2 teprea