Bonus Act - Administration

Administration

3.1 Maintenance of registers, records, etc. (sec. 26)

Every employer shall prepare and maintain prescribed registers, records and other documents.

Rule 4 of the Payment of Bonus Rules, requires the following registers to be prepare and maintained:

i.      a register showing the computation of the allocable in From A.

ii.    a register showing the set-on and set-off the allocable surplus under section 15 in From B,

iii.   a register showing the details of the amount of bonus to each of the employees, the deduction under Section 17 and 18 and the amount actually disbursed in Form C.

3.2 Resolve of disputes (Sec. 22)

Any dispute regarding payment of bonus shall be deemed to be an industrial dispute; and can be settled among them (employer and employee), as per Industrial Disputes Act 1947, or any other appropriate law, e.g. by arbitration. [D.P. Kelkes v. Ambadas]

Dispute over the quantum of ‘available surplus’ would not be an industrial dispute as defined by the Industrial Disputes Act for the purpose of this section. Section 39 of this Act will then be available, since section 39 provides that the provisions of this Act shall be in addition to and not in derogation of the Industrial Disputes Act or corresponding laws in force in State.

3.3 Presentation of Accounts in case of Dispute

3.3.1 Presumption about Audited Accounts (Sec. 23)

The appropriate authority may presume that the statements and particulars in the balance sheet and profit and loss account of the corporations and companies are accurate if they are duly audited by Company Auditor or CAG.

In such case, The company need not prove the accuracy of such statements and particulars by filing an affidavit or by any other method. The trade union may ask for any clarification regarding the accounts submitted.

The authority, on an application made by any trade union who is a party to the dispute (or employees party to the dispute), may require any clarification relating to any item in the Balance Sheet or the Profit and Loss Account from the employer corporation or company.

Where the authority is not satisfied by the statements and particulars contained in the balance sheet and the profit and loss account of the corporation or the company, it may take necessary steps to find out the accuracy of such statements or particulars.

Sec. 23 does not deal with the summoning of evidence on record. The correctness of duly and properly audited accounts produced by a company is presumed and normally a case should be decided on that basis.       

3.3.2 Audited accounts of banking companies (Sec. 24)

In case of Banking Companies, the trade union or the employee cannot question the correctness of accounts which are duly audited. However the employee may get the necessary information for verifying the amount of bonus due under the Act [Sec. 24 (1)]. The company cannot be compelled to furnish information protected under Banking Regulation Act) in the course of dispute.

Although duly audited accounts of a banking company are not to be questioned before adjudicating authority, the trade union or the employees may be permitted to obtain from the banking company such information as is necessary for verifying the amount of bonus under this Act. The trade union or the employees are not permitted to obtain any information which the banking company is not compelled to furnish under the provisions of Section 34A of the Banking Regulation Act, 1949.

3.3.3 Audit of accounts other than of companies or corporations (Sec. 25)

If the accounts of public sector are audited by an auditor and produced before the authority then the provisions of Sec. 23 of the Act shall be applied to the accounts so audited.

Where duly audited accounts of an employer are produced, such accounts shall attract the presumption of accuracy contemplated under section 23. In case such accounts are not duly audited by the qualified auditors, the authority is empowered to get such accounts audited by such auditor or auditors as he thinks fit. The employer is not obliged to supply statement of accounts to the trade unions.

 

3.4 Inspectors (Sec. 27)

The appropriate Government may appoint Inspectors and define the limits to exercise jurisdiction.

An inspector who is deemed to be a public servant is a person, appointed by the appropriate government through a notification in the official gazette. The purpose of appointing inspector is to ascertain whether the provision of the act are complied by or not.

3.4.1 Powers of Inspectors

To ascertain compliance of the Act by any establishment, an Inspector may —

a.     Require an employer to furnish Information as he considers necessary

b.    Enter into any establishment (at reasonable time) and require production of any books registers and documents from the employer

c.     Examine the employer, his agent or servant or any other person found in charge of the establishment.

d.    Make copies of, or take extracts from, any book, register or other documents

e.     Exercise such other prescribed powers [Sec. 27 (2)].

3.5 Penalties (Sec. 28)

If any person contravening any rule shall be punishable with imprisonment for which may extend to 6 months, and / or with fine which may extend to Rs.1,000.

3.6 Offences

3.6.1 Offences by companies (Sec. 29)

Every person in charge of, and was responsible to the company at the time of offence shall be deemed to be guilty and shall be liable to be proceeded against and punished accordingly.

3.6.2 Cognizance of offences (Sec. 30)

No Court shall take cognizance of any offence punishable under the Act, except on complaint made by appropriate Government officer (not below the rank of a Regional Labour Commissioner.

3.6.3 Protection of action (Sec.31)

No legal proceedings can be taken against government or any government officials for anything done in good faith.

3.7 Laws inconsistent (Sec. 34)

Section 34, the Act predominates over all existing statutes award, agreement, settlement or contract of service excepting agreements for annual bonus linked with production or productivity in liew of bonus based on profits. Consequently all awards, agreements, settlements and contracts of service in matters relating to Bonus but not linked with productivity have lost their force.

3.8 Miscellaneous

3.8.1 Saving (Sec. 35)

Nothing contained in this Act shall be deemed to affect the provisions of the Coal Mines Provident Fund and Bonus Schemes Act, 1948 (46 of 1948), or of any scheme made under. 

3.8.2 Power to make rules (Sec. 38)

The Central Government may make rules for the purpose of carrying into effect the provision of this Act.

3.8.3 Application of certain laws not bassed (Sec. 39)

The provisions of this Act shall be in addition to and not in derogation of the Industrial Dispute Act or any law relating to investigation and settlement of industrial disputes in force in a state.

3.8.4 Repeal and Saving (Sec. 40)

The Payment of Bonus Ordinance, 1965 (3 of 1965) hereby repealed.