Patna High Court
Agent Muridhar Colliery Of Bharat ... vs Sital Chandra Pathak And Ors. on 1 October, 1985
Equivalent citations: 1986(34)BLJR559
JUDGMENT S.S. Sandhawalia, C.J.
1. Whether the Central Government or the Government Company (as the case may be) is liable for the whole of the claim of gratuity of a workman superannuating after the appointed day of 1st May, 1972, irrespective of the earlier period of service rendered to the previous owner, in view of Section 17 of the Coking Coal Mines (Nationalisation) Act, 1972 is the significant question necessitating this reference to the Full Bench. Equally at issue is the correctness of the earlier Division Bench judgment on this point in Coal Fields Limited v. Mrs, Prabhawati Rairkar and Ors. C.W.J.C No. 66 of 1978 (R), decided on March 10, 1983.
2. The facts are not in dispute and lie in a narrow compass. Sital Chandra Pathak, respondent No. 1, was appointed as a Mining Sirdar way back on the 24th of June, 1946 in Katras Chaitudih Colliery then owned by Messrs. Barakar Coal Company Limited. He served the said colliery in that capacity and thereafter was promoted as an Overman with effect from the 26th of October, 1950. The services of respondent No. 1 were terminated by Messrs. Barakar Coal Company Limited with effect from the 12th of March, 1968. Respondent No. 1 along with others raised an industrial dispute and the Tribunal, by its award dated the 20th of January, 1976, set aside the termination of services and held that the workman concerned shall be deemed to have continued in service. During the pendency of the proceedings before the Tribunal, respondent No. 1 joined the Murlidhar Colliery on the 24th of February, 1969 and after the nationalisation thereof his services were taken over by the petitioner company, namely, Messrs Bharat Coking Coal Limited (hereinafter referred to as the 'petitioner company').
3. Respondent No. 1 reached the age of superannuation on 22nd of September, 1981 and the petitioner company sought to pay him the gratuity only for the period from the 24th of February, 1969 till the date of his superannuation on the 22nd September, 1981, and tendered a sum of Rs. 7,499.70. Dissatisfied with the amount, respondent No. 1 filed a petition for his claim of gratuity for the entire period from the 24th of February, 1946 till the date of his superannuation before the Controlling Authority-cum-Assistant Labour Commissioner (Central), Dhanbad, respondent No. 2. The latter allowed the total claim after deducting the admitted payment of gratuity to the respondent. The petitioner company appealed to the Regional Labour Commissioner (Central) cum-Appellate Authority under the payment of Gratuity Act. The said Authority however, upheld the claim of the respondent for the total period of service of thirty-six years with marginal arithmetical modifications. Aggrieved thereby, the petitioner company has preferred this petition primarily on the ground that it was not liable for the claim of gratuity for the period of service prior to the appointed day of the 1st of May, 1972.
4. This case originally came up for hearing before a Division Bench, and basic reliance was sought to be placed on behalf of the petitioner on the earlier decision in Central Coalfields Limited v. Prabhawati Sarkar and Ors.) (supra), Noticing the significance of the question involved and entertaining some doubt about the correctness of earlier view, the matter has been referred to the Full Bench for an authoritative adjudication.
5. As would be evident hereinafter, the whole debate herein has centred around Sections 9 and 17 of the Coking Coal Mines (Nationalisation) Act, 1972 (hereinafter to be referred to as the 'Act'). It is, therefore, apt to read the relevant parts thereof at the very outset:
9 (1) Every liability of the owner, agent, manager, or managing contractor of a coking coal mine or coke oven plant, in relation to any period prior to the appointed day, shall be the liability of such owner, agent, manager or managing contractor, as the case may be, and shall be enforceable against him and not against the Central Government or the Government company, (2) For the removal of doubts, it is hereby declared that--
(a) save as otherwise provided elsewhere in this Act, no claim for wages, bonus, royalty, rate, rent, taxes, provident fund, pension, gratuity or any other dues in relation to a coking coal mine or coke oven plant in respect of any period prior to the appointed day, shall be enforceable against the Central Government or the Government company;
(b) no award, decree or order of any court, tribunal or other authority in relation to any coking coal mine or coke oven plant passed after the appointed day, but in relation to any matter, claim or dispute which arose before that day, shall be enforceable against the Central Government or the Government company;
(c) no liability for the contravention of any provision of law for -the time being in force, made before the appointed, day, shall been forceable against the Central Government or the Government company.
17 (1) Every person who is a workman within the meaning of the Industrial Disputes Act, 1947, and has been, immediately before the appointed day, in the employment of a coking coal mine or coke oven plant, shall become, on and from the appointed day, an employee of the Central Government, or, as the case may be, of the Government company in which the right, title and interest of such mine or plant have vested under this Act, and shall hold office or service in the coking coal mine or coke oven plant, as the case may be, on the same terms and conditions and with the same rights to pension, gratuity and other matters as would have been admissible to him if the rights in relation to such coking coal mine or coke oven plant had not been transferred to, and vested in, the Central Government or the Government company, as the case may be, and continue to do so unless and until his employment in such coking coal mine or coke oven plant is duly terminated or until his remuneration, terms and conditions of employment are duly altered, by the Central Government or the Government company.
It is necessary to have a bird's eye view of the legislative history culminating in the enforcement of the Act. Prior thereto, there was an Ordinance known as the Coking Coal Mines (Emergency Provisions) Ordinance which came into force on the 17th of October, 1971. Thereby the management of the collieries mentioned in the Schedule attached to the said Ordinance vested under the Central Government. The aforesaid Ordinance was, thereafter, replaced by an Act of Parliament known as the Coking Coal Mines (Emergency Provisions) Act, 1971. It appears that with a view to exercising greater control over the coking coal mines and the coke oven plants, the present Coking Coal Mines (Nationalisation) Act, 1972 (Act 36 of 1972) was enacted and enforced. Therein by virtue of Clause (a) of Section 3, the 'appointed day' means the first day of May, 1972.
6. Now, the broad scheme of the statute is clearly indicative of two things. Under Section 9 every liability of the previous owners of the mines or plants prior to the 1st of May, 1972 would continue to be the liability of such owners. The Central Government or the Government company is absolved of such liabilities accruing prior to the appointed day which are expressly declared to be not enforceable against them. On the other hand, by virtue of Section 17(1) every workman (within the meaning of the Industrial Disputes Act) employed in the mines or plant shall become on the appointed day an employee of the Central Government or the Government company, as the case may be. Such workman will hold office under the Central Government or the Government company on the same terms and conditions and with the same rights to pension and gratuity and other matters as would have been admissible to him under the previous employers. Therefore, the core question herein is as to what is the precise point of time when the right to claim gratuity arises in the workman and the corresponding liability to pay the said gratuity fastens on the employer ? In terms of article when does the cause of action for gratuity accrue to the workman ? This is so because under Section 9 of the Act it is the incidence of the liability which would determine the matter. The question is whether such liability accrued prior to the appointed day or subsequent thereto ?
7. The issue aforesaid at once takes us to examine the very nature of the claim for gratuity, after a satisfactory completed period of service. What, perhaps, calls for pointed notice at the threshold is the fact that as a term of article gratuity (despite its literal connotation and origin) is on longer gratuitous. Indeed, as would be hereafter evident, the claim to gratuity may become a statutory, contractual or an industrial right enforceable at law. However, even in its ordinary dictionary meaning, the word 'gratuity' in the context of its present examination signifies a payment in recognition of a satisfactory completed period of service. In Oxford Illustrated Dictionary, 'gratuity' means a money present in addition to payment due in recognition of services; bounty given to soldiers on discharge, retirement, etc. In Chambers Twentieth Centrury Dictionary, it means an acknowledgment of service usually pecuniary; a payment to a soldier on discharge. In the Random House Dictionary, the meaning given is a bonus given to a military personnel on discharge or retirement.
8. Coming now to the specific provisions of the Payment of Gratuity Act, 1972, under which the claim and issues arise, it is significant to notice that the same does not even attempt to define 'gratuity' in any one of its provisions. However, it is manifest therefrom that thereunder the right to gratuity is an enforceable statutory right available to an employee engaged in a factory, mine, oilfield, plantations, ports, railway companies, shops and other establishments. Sections 2 (q) and (r) draw a line betwixt retirement and superannuation in the following terms thereunder:
(q) retirement means termination of the service 'of an employee otherwise than on superannuation.' "(r)" 'Superannuation', in relation to an employee, means--
(i) the attainment by the employee of such age as is fixed in the contract or conditions of service as the age on the attainment of which the employee shall vacate the employment; and
(ii) in any other case, the attainment by the employee of the age of fifty-eight years;
Clauses (b) and (c) of Section 8 also define the allied concepts of 'continuous service' and a 'completed year of service'. Section 4 incorporates the right to, and the payment of gratuity, and the relevant. parts thereof require notice in extenso:
4. Payment of gratuity.--(1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years,--
(a) on his superannuation, or
(b) on his retirement or resignation, or
(c) on his death or disablement due to accident or disease:
* * * * * (2) For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days' wages based on the rate of wages last drawn by the employee concerned:
* * * * * (3) The amount of gratuity payable to an "employee shall not exceed twenty months' wages.
* * * * * (6) Notwithstanding anything contained in Sub-section (i),--
(a) the gratuity of an employee, whose services has been terminated for any act, wilful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be forfeited to the extent of the damage or loss so caused;
(b) the gratuity payable to an employee shall be wholly forfeited--
(i) if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or
(ii) if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment.
It is plain from the above that the eligibility for gratuity does not arise till the completion of five years of continuous service. What, however, is more significant is the fact that gratuity becomes payable to an employee on the termination of his employment (and not earlier) by way of superannuation, retirement, resignation or death or disablement due to accident or disease. Equally worthy of notice is the fact that the claim to gratuity is not an indefeasible right and may be defeated either wholly or partially for reasons specified in the afore quoted Sub-section (6) of Section 4. Therefore, the right to the payment of gratuity arises only on the fulfilment of the statutory conditions and termination of the employment in any one of the five modes indicated above. It is only at the end of the period of his service that a workman can strictu sensu claim that he has now become entitled to the payment of gratuity. Thus, it is obvious that the right to gratuity accrues only and co-termihously with the satisfactory conclusion of his employment by the employee. Both the right to gratuity and the corresponding liability of the employer to pay the same would thus arise at that point of time.
9. It is noticeable that both in Sections 9 and 17 the Act treats pension and gratuity as closely allied terms in the context of the end of the employee's period of service. Therefore, what has been said with regard to gratuity would seem broadly applicable to the claim for pension when it ultimately arises. Particularly; the right and claim to pension would also arise only on the successful completion of the statutory or contractual period of service. It seems somewhat obvious that the same is not a divisible claim. It is hardly feasible, if not impossible, that pension be apportionable betwixt two employers. As noticed already the claim of pension; accruing, as it does, on the date of successful superannuation, is an indivisible one and at that point of time an employee cannot be said to be working for two or more masters. It is a single indivisible claim by one employee against a corresponding single indivisible liability of a single employer. These considerations are equally attracted in the context of gratuity with some inevitable variations.
10. What has been said above on larger principle is more particularised when reference is made to Section 17(1) of the Act. This, in unequivocal terms, says that on the appointed day the eligible workman shall become an employee of the Central Government or, as the case may be, of a Government company, Thus, by a mandate of the law, the workmen coming within the sweep of Section 17(1) are after the appointed day declared to be the employees of the Central Government or the Government company, as the case may be. Inevitably, therefore, any right or claim of the employee arising or accruing after the appointed day is necessarily to be against his employer so declared by law and not against any earlier or previous employers. Plainly enough, the relationship with the former employers stands snapped by Section 17(1) and by a fiction of mandate of the law all such workmen become employees of the State with all its necessary implications.
11. To sum up on this aspect, it must be held that the right to gratuity accrues only and co-terminously with the satisfactory conclusion of his employment by the employee. Both the right and claim to gratuity by the workman and the corresponding liability of his employer to pay the same would thus arise at that precise point of time. It terms of Article the cause of action for gratuity accrues at that stage. By virtue of Section 9, if this cause of action arose or accrued prior to the appointed day of 1st May, 1972, the liability would be entirely of the previous owner. However, if the same arose or accrued after the day aforesaid, the liability would be wholly of the Central Government or the Government company, as the case may be.
12. In fairness to Mr. Chatterji, the learned Counsel for the petitioner, one must notice that he firmly placed reliance on Clause (a) of Sub-section (2) of Section 9 to contend that in the said Clause pension and gratuity found specific mention and, therefore, any claim with regard thereto in respect of any period prior to the appointed day would not be enforceable against the Central Government or a Government company. It was submitted that even if there be some conflict of this provision with Section 17(1) the same should be harmonised by apportioning the liability prior to the appointed day on the previous owners, and subsequent thereto on the Central Government or a Government company, as the case may be. The central theme of the argument was that Section 17(1) would not override the provisions of Section 9(2)(a) with particular reference to pension and gratuity.
13. Though one must compliment the learned Counsel for the petitioner for his ingenuity, the contention aforesaid necessarily goes down on a closer analysis. Firstly, the submission loses sight of the basic concept elaborated earlier that if the cause of action itself and the consequent liability arises after the appointed day then Section 9(1) must be altogether excluded out of consideration. Sub-section (2) of Section 9 merely is an elaboration of the basic rule and for the removal of doubts therein and, therefore, cannot possibly travel beyond the filed covered by Sub-section (1) of Section 9. This has been authoritatively so held in Workmen v. Bharat Coking Coal Ltd. , in the following terms:
Section 9(1) deals with pecuniary and other liabilities and has nothing to do with workmen. If at all it has anything to do with workmen it is regarding arrears of wages or other contractual, statutory or tortious liabilities. Section 9(2) operated only in the area of Section 9(1) and that is why it starts off by saying" for the removal of doubts it is hereby declared...". So, Section 9(2) seeks only to remove doubts in the area covered by Section 9(1) and does not deal with any other topic or subject-matter.
14. What next calls for pointed notice in this context is the saving clause in Section 9(2)(a) which itself begins as "save as otherwise provided else where in this Act". Therefore, even if for argument's sake it is held that Section 9(2)(a) was attracted (without remotedly holding so) it must be held as subservient to Section 17(1) of the Act which otherwise provides for gratuity and pension. The latter provisions in categorical terms declares that a workman in the Industrial Disputes Act would become an employee of the Central Government or the Government company, as the case may be, on the appointed day. In particular, Section 17, (1) refers in express terms both to pension and gratuity. It further guarantees to the workmen the same terms and conditions and the same service rights which they enjoyed under the previous owners. Consequently the provision of Section 17(1) which specially governed the status and service condition of workmen and expressly the rights of pension and gratuity would override the general provision of Section 9 with regard to every kind of prior liabilities. Therefore, the saving clause in Section 9(2)(a) is a clear pointer to his effect.
15. Even otherwise it is settled beyond cavil that within the same statute so a special provision would override a general one. Way back in (J.K.C. S. & W. Mills v. State of U. P.) , their Lordships had observed as follows:
We reach the same result by applying another well known rule of construction that general provisions yield to special provisions. The learned Attorney-General seemed to suggest that while this rule of construction is applicable to resolve the conflict between the general provision in one Act and the special provision in another Act, the rule cannot apply in resolving a conflict between general and special provisions in the same legislative instrument. This suggestion does not find support in either principle or authority. The rule that general provisions should yield to specific provisions is not an arbitrary principle made by lawyers and judges but springs from the common understanding of men and women that when the same person gives two directions one covering a large number of matters in general and another to only some of them his intention is that these latter directions should prevail as regerds these while as regards all the rest the earlier direction should have effect.
I would recall that Mr. Chatterji's repeated insistence was that the conflicting provision must be harmonised and he placed reliance on Raj Krushna v. Binod ; Sanjeevayya v. Election Tribunal and Ors. A.I.R. 1967 S.C. 1211; Sirsik, Ltd. v. Government of Andhra Pradesh . There is no quarrel with the proposition that in the event of conflict or divergence between the two provisions they must be harmoniously construed. However, as was pointed out by their Lordships in Chief Inspector of Mines v. K.C, Thapar . to harmonise is not to destroy the clear mandate of a special provision as against the general one. It appears to me that on the specific issue the matter is now concluded by the following observations in (supra) pertaining to this Section 17 of the Act itself:
Section 17 is a special provision relating the workmen and their continuance in service notwithstanding the transfer from private ownership to the Central Government or Government company. This is a statutory protection for the workmen and is express, explicit and mandatory. Every person who is a workman with in the meaning of the Industrial Disputes Act, 1947, and has been, immediately before the appointed day, in the employment of a mine, shall become an employee of the Government or the Government company and continue to do so as laid down in Section 17.
It must, therefore, be concluded that even on the assumption of there being some conflict in the provisions of Sections 9 and 17 the latter being a special provision must be given pre-eminence and would override the general provisions of Section 9(1) in this context.
16. One must also notice the anomalous rasults which necessarily flow from the construction canvassed on behalf of the petitioner. If it could be said that, however, long after the nationalisation and the appointed day the workman must seek to claim his pensionary and gratuity benefits from the previous owners, it would be virtually throwing such workmen to the wolves. A period of nearly a decade and half has elapsed since the nationalisation and the appointed day and as time passes a workman might well have served for 20 years and more under the Central Government or the Government company, as the case may be. To require that thereafter on superannuation, retirement, or termination otherwise of his service, he should after a period of 20 years start seeking his previous employers for his service benefits would look wholly farcical and would render nugatory the very purpose and object of Section 17 of the Act. In deed such previous employers or owners may now be non-existent and therefore, his claims pertaining to the period of service rendered to previous owner prior to the appointed day would be merely chimerical and wholly in the air. This aspect is well illustrated and highlighted by the present case itself. Herein the respondent Sital Chandra Pathak had served two or three employers during the, period of his first employment from the 24th of June, 1946 till the appointed day of 1st May, 1972. That he should now be asked to seek his original employer of the year 1946 for gratuity which has become due to him on the successful completion of his service and retirement does not stand to reason. Therefore, a construction which would lead to such anomalous, and if one may say so, mischievous consequences and result in grave hardship to workmen whose rights were expressly sought to be protected by the Act has to be avoided on larger canons of construction as well.
17. Lastly, one must advert to the sheet-anchor of the petitioner's stand on Central Coalfields Limited v. Prabhawati Rairkar and Ors. Now it was a common ground before us that Sections 9 and 17 of the Coking Coal Mines (Nationalisation) Act, 1972 are identical and in pari materia with Sections 7 and 14 of the Coal Mines (Nationalisation) Act, 1973, respectively. In the context of construing the said Sections 7 and 14 of the Coal Mines (Nationalisation) Act, 1973 that the Division Bench in Central Coalfields Limited v, Prabhawati Rairkar and Ors. has undoubtedly taken a contrary view. However, a perusal of the brief judgment rendered would indicate that the issue does not seem to have been adequately canvassed before the Bench by the learned Counsel for the parties. The core question of the precise time when the cause of action for gratuity or pension arises and the corresponding liability to pay the same was neither projected nor adjudicated upon. The saving clause in Section 7(2)(a) was not noticed. Similarly, the true nature of Section 14 being the special provision seems to have been missed consideration. The rule that the special provision would override the general one was not adverted to. The binding precent in (supra) was not cited before the Bench. For all these reasons, it must be held with the deepest deference that M/s. Central Coalfields Limited v. Mrs. Prabhawati Rairkar and Ors. does not lay down the law correctly and is hereby overruled.
18. To finally conclude the answer to the question posed at the very outset is rendered in the affirmative. It is held that the Central Government or the Government Company, as the case may be, would be liable for the whole of the claim of gratuity of a workman superannuating after the appointed day of 1st May, 1972, irrespective of the earlier period of service rendered to the previous owners.
19. Once it is held, as above, it necessarily follows that the writ petition must fail. The controlling authority-cum-Assistant-Labour-Commis-sioner was thus correct in allowing the total claim of the respondent and the appellate authority was equally right in upholding the same. The writ petition is consequently dismissed but, in view of some conflict of precedent, we leave the parties to bear their own costs.
S. Roy and R.C.P. Sinha, JJ.
We agree with Hon'ble the Chief Justice.
20. In this connection Section 17(5) of the Act also requires to be noticed. It speaks of two kinds of persons, those whose services have been terminated and those whose services become transferred to the Central Government or Government Company. So far as workmen governed by Section 17(1) of the Act are concerned, as held by Hon'ble the Chief Justice, by legal fiction all such workmen became employees of the Central Government or Government company, as the case may be. They, therefore, cannot be said to be "transferred" employees, consequently in their case Section 17(5) of the Act is also not attracted.