TMI Blog1960 (12) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... trial Disputes Act, 1947 (XIV of 1947). This question arises in this way. The workmen of the Hercules Insurance Co. Ltd. are the appellants and the Insurance Company is the respondent before us. On April 11, 1957, the Central Government referred the appellants' claim for bonus for the years 1954 and 1955 for adjudication to the Industrial Tribunal, Dhanbad, constituted under section 7A of the Industrial Disputes Act, and this reference has been made under section 10(1)(d) and proviso (vii) of the Insurance Act. It was also urged by the respondent that having regard to the limitations imposed on the General Insurance Companies by section 40C of the Insurance Act the claim for bonus made by the appellants could not be sustained. The Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1913, or in the articles of association of the insurer, if a company, or in any contract or agreement, no insurer shall after the expiry of one year from the commencement of the Insurance (Amendment) Act, 1950, be directed or managed by, or employ as manager or officer or in any capacity, any person whose remuneration or any part thereof takes the form of commission or bonus in respect of the general insurance business of the insurer. Thus looking section at 31A(1)(c) by itself without the proviso the position is absolutely at clear. The respondent cannot be directed to employ the appellants in any capacity so as to include in their remuneration a liability to pay bonus in respect of the general insurance business of the respondent. Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch constitutes an exception to the rule prescribed by section 31A(1)(c) allows the payment of bonus to the employees of Insurance Companies subject to the condition specified by it. Bonus intended to be paid to such employees must not exceed in amount the equivalent of their salary for a period which the Central Government regards as reasonable. The result of this provision appears to be that the Central Government has to consider the circumstances of each insurer and then decide whether any bonus should be paid by the insurer to its employees. If the financial position of the insurer is sufficiently satisfactory, the Central Government may decide to allow the insurer to pay bonus to its employees, and in that context the Central Government ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt should have authority to make the reference. Similarly it is urged that the Central Government may decide that within the maximum prescribed by it, bonus should be paid by an insurer, but the insurer may not comply with the Central Government's decision and in that case the only way to make the Central Government's decision effective is to refer the matter to adjudication and enable the employees to obtain an award which can be executed. That is why the appellants contend that the enabling provision contained in proviso (vii) should not be construed to constitute a bar against the Central Government's power to act under section 10(1) of the Industrial Disputes Act. 7. We are not impressed by this argument. In our opinion t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Central Government is invalid. The fact that the Central Government took the view that it could make such a reference is hardly relevant in determining the scope and effect of the relevant provisions of the Act. This question must be considered on what we regard to be the fair construction of the relevant statutory provision, and as we have just indicated the construction of the relevant provision clearly supports the view taken by the Tribunal. Incidentally, it may be pointed out that in its award the Tribunal has referred to several other decisions of Industrial Tribunals which have taken the same view though there are one or two decisions which have upheld the validity of the reference without duly considering the effect of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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