I would like you to go through the provisions of section 16 of the Payment of Bonus Act, 1965 in order to get a clear picture about the bonus liability of a newly started establishment.
In the case of a new establishment undergoing the phase of gestation, no bonus liability towards the employees employed during such period.
During the first 5 years the liability would arise only when production is commenced and profits are earned.
From India, Salem
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