Likelihood Of Divergent Views Cannot Be Ground For Transfer: SC Declines Centre's Plea To Transfer Cases Challenging Bonus Act

The Supreme Court has dismissed the Centre's plea to transfer over 140 cases challenging the constitutional validity of the Payment of Bonus (Amendment) Act, 2015, filed in as many as 18 High Courts to the Supreme Court or any one High Court saying the likelihood of divergence of views, cannot be a ground for transfer.

A Bench of Justice Dinesh Maheshwari and Justice Vikram Nath said that having regard to the subject matter and the variety of questions likely to arise in the matter, it does appear appropriate to have the benefit of the views of the jurisdictional High Courts before the questions of law are taken up for consideration in this Court if occasion so arises.

It said that such a course appears better to serve the cause of justice, including protecting the right of seeking judicial review after the decision of the Court of the first instance.

The Bench held, "Accordingly, the prayer for transfer of the subject petitions is declined and all the interim stay orders are vacated while providing that it shall be permissible for the parties to request the respective High Courts for expeditious hearing and disposal of the pending writ petitions. For that matter, we would also request the respective High Courts to proceed with the matters expeditiously, while assigning them reasonable priority".

The Apex Court said that it need not multiply the reference to various other orders passed by this Court relating to the prayer for transfer because, ultimately, the decision to transfer or not, to this Court or one High Court, has been taken by this Court in the exercise of its jurisdiction under Article 139A of the Constitution of India with reference to the given set of facts and circumstances.

"No hard and fast rule or any structured formula is provided nor appears desirable; a comprehensive view of all the facts and relevant surrounding factors is the best guiding light for the exercise of this jurisdiction under Article 139A of the Constitution of India", it said.

It said that in the present set of facts and circumstances, for what has been noticed and discussed the court is clearly of the view that transfer of the pending writ petitions from the respective High Courts is not called for.

"The likelihood of divergence of views, looking to the framework of the statute itself, cannot be a ground for transfer. Equally, there appears no reason to transfer the matters to any one High Court; rather it appears just and proper that the petitions in the jurisdictional High Courts are decided with reference to their own factual background and the law applicable. Hence, we do not consider it necessary to deal with the cases cited in support of the proposition for transfer of the matters to any one High Court ", the Bench held.

The Payment of Bonus (Amendment) Act of 2015 introduced two major changes to the Payment of Bonus Act, 1965 with one being the amendment of clause (13) of Section 2, raising the salary limit from Rs 10,000 to Rs 21,000 per month for the purpose of coverage under the Act.

The other amendment was with regard to raising the wage ceiling for calculating the bonus under Section 12 from Rs 3,500 to Rs 7,000 per month or the minimum wages for the scheduled employment as fixed by the appropriate Government, whichever be the higher.

These amendments were given retrospective effect in Section 1 of the Amendment Act of 2015 by providing that it shall be deemed to have come into force on April 1, 2014. The validity of the amendments has been challenged in various writ petitions pending before different High Courts mainly on two counts: first, against the requirement of payment of bonus as per the amended provisions with retrospective effect from the year 2014-15, and secondly, against the validity of linkage to the minimum wages in regard to the calculation of the bonus.

The Centre has pointed out that the petitions filed in various High Courts in challenge to the Amendment Act of 2015 have been entertained with different interim orders in some of the petitions inasmuch as some of the High Courts have directed that the amendment shall take effect only from the financial year 2015-16 whereas one High Court has directed to implement the same from the financial year 2016-17.

It had said that one another High Court has directed that no coercive action shall be taken against the writ petitioners. Seeking transfer of the cases from different High Court, the Centre has pointed to the divergence of views.

The bench said, "Having given thoughtful consideration to the rival submissions and having examined the record, even when we agree with the submissions that the writ petitions related with this batch of matters might carry substantially the same questions of law concerning the constitutional validity of the Payment of Bonus (Amendment) Act, 2015 but, for a variety of other relevant reasons, we are disinclined to transfer these matters in this Court or even to one High Court".

It said that in the scheme of the Act of 1965 and in relation to the questioned amendments, variance in some of the questions and some of the factual aspects is likely to occur because of the innate role of the appropriate Government in the ultimate calculation of bonus with respect to certain employees in terms of the amended provisions.

Click here to read/download Order

With PTI inputs