Gauhati High Court
WA/275/2021 on 5 September, 2022
Author: R. M. Chhaya
Bench: Chief Justice, Soumitra Saikia
Page No.# 1/11
GAHC010086372021
THE GAUHATI HIGH COURT AT GUWAHATI
(The High Court of Assam, Nagaland, Mizoram and Arunachal Pradesh)
(PRINCIPAL SEAT AT GUWAHATI)
WA No. 275/2021
Assam Gramin Vikash Bank,
Represented by its Chairman,
Head Office, G.S. Road,
Bhangagarh, Guwahati - 781005.
- Writ appellant
- Versus -
Smt. Babita Gupta,
Wife of Diwakar Roy,
Resident of Arya Path 2,
Sarab Bhatti, Girls Hostel Road,
House No. 6, Guwahati-781016.
- Respondent.
Advocate for the appellant : Mr. S. Dutta, Senior Advocate.
Ms. S. Mochahari, Advocate.
Advocate for the respondents : Ms. D. Borgohain, Advocate.
Ms. J. Purkayastha, Advocate.
BEFORE
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE SOUMITRA SAIKIA
Date of order : 5th September, 2022.
Page No.# 2/11
JUDGMENT AND ORDER
(R. M. Chhaya, CJ)
Feeling aggrieved and dissatisfied by the judgment and order dated 09.03.2021 passed by the learned Single Judge in Writ Petition (Civil) No. 1697/2018, the original respondents have preferred this writ appeal.
2. Heard Mr. S. Dutta, learned senior counsel assisted by Ms. S. Mochahari, appearing for the appellant, and Ms. D. Borgihain, learned counsel, with Ms. G. Purkayastha, appearing for the respondent.
3. The following noteworthy facts arise out of this appeal:
(i) The respondent was working in the appellant bank in the post of Junior Management Scale-I Officer since 28.05.2012. As per the record, the respondent was transferred from Head Office of the appellant bank to Nalbari Branch on 27.11.2017.
The record indicates that on such transfer having been made, the respondent filed representation before the Chairman of the bank to reconsider her transfer. However, as the said representation was not considered favourably, she tendered her resignation vide her letter dated 27.11.2017 from the post of Assistant Manager with effect from 03.03.2018. The appellant bank accepted the resignation so filed by the respondent and relieved her from service with effect from 03.03.2018. On 16.01.2018, the respondent filed an application before the appellant bank for payment of gratuity. Upon considering the same, the appellant bank, vide a communication dated 08.02.2018 informed the respondent that as per the provision of Regulation 72(2)(d) of the Assam Gramin Vikash Bank (Officers and Employees) Service Regulations, 2010 (hereinafter referred to as "2010 Regulation"), as the respondent has not completed 10 years of service but has, in fact, completed only 5 years and 10 months of service till the date of her resignation, she will not be eligible for any gratuity.
(ii) The said decision taken by the appellant came to be challenged by the Page No.# 3/11 respondent by way of filing the present writ petition mainly on the ground that as per section 4 of the Payment of Gratuity Act, 1972 (hereinafter referred to as "1972 Act"
for the sake of brevity), as the respondent has completed 5 years of service, she would be entitled to gratuity. In the writ petition, the respondent/original petitioner, relying upon the chronology of service rendered by her, further contended that as per the provisions of the 1972 Act and, more particularly, section 14 of the 1972 Act, the 2010 Regulations cannot be brought into effect to deny the benefit confirmed by section 4 of the 1972 Act. It is also contended by the respondent/ original petitioner that as she has put in 5 years 10 months service, she would be entitled to gratuity equivalent to an amount or more than 5 months' salary. In the writ petition it was also contended by the respondent/original petitioner that the appellant/original respondent have misconstrued the provisions contained in Regulation 72 of the 2010 Regulation and have thus deprived the respondent/original petitioner from her legitimate right of payment of gratuity and, inter alia, prayed as under:
"In the premises aforesaid it is therefore, humbly prayed that Your Lordships may be pleased to admit this petition and call for the records, issue a Rule calling upon the respondents to show cause as to why the relief sought for in this application should not be granted and on cause or causes being shown and on hearing the parties and perusal of records be pleased to direct the respondent authorities to pay the gratuity due to the petitioner on her resignation from service and calculated as per Regulation 72(3) of the Service Regulation of 2010 along with interest and/or pass any other such order or orders as Your Lordships may deem fit and proper."
(iii) The appellant herein/original respondent filed a detailed affidavit-in- opposition and denied the contentions raised by the respondent/original petitioner. The learned Single Judge came to the conclusion that as the respondent has not fulfilled the conditions of eligibility as per Regulation 72(3) of the 2010 Regulation and as the 2010 Regulations is a Special Act, no other Act can override it. However, the Page No.# 4/11 learned Single Judge came to the conclusion that the writ petitioner is eligible for claiming gratuity under the 1972 Act and while allowing the writ petition, the respondents (present appellant) were directed to process payment of gratuity to the writ petitioner (present respondent) under the provisions of section 4 of the 1972 Act. Being aggrieved, the bank and its authorities have preferred this appeal as aforesaid.
3. Mr. S. Dutta, learned senior counsel appearing for the appellant bank contended that the 2010 Regulations, being framed in exercise of powers conferred by section 30 of the Regional Rural Banks Act, 1976 is a Special Act and, therefore, the Special Act would prevail over the General Act, i.e. the Payment of Gratuity Act, 1972. Mr. Dutta, learned senior counsel further contended that the respondent/original petitioner has not challenged the 2010 Regulations and, therefore the conditions as laid down under the 2010 Regulations are to be followed. Mr. Dutta further relied upon the judgment of the Apex Court in the case of P. Ranjan Sandhi vs. Union of India & Another, reported in (2010) 10 SCC 338 to buttress the argument that the 2010 Regulations being Special Law will prevail over section 4 of the Payment of Gratuity Act. Learned senior counsel for the appellant bank invited attention of this Court to the observations made by the Apex Court in paragraph 11 of the said judgment, which reads as under:
"11. It may be seen that there is a difference between the provisions for denial of gratuity in the Payment of Gratuity Act and in the Working Journalists Act. Under the Working Journalist Act gratuity can be denied if the service is terminated as a punishment inflicted by way of disciplinary act, as has been done in the instant case. We are of the opinion that Section 5 of the working Journalists Act being a special law will prevail over Section 4(6) of the Payment of Gratuity Act which is a general law. Section 5 of the Working Journalists Act is only for working journalists, whereas the Payment of Gratuity Act is available to all employees who are covered by that Act and is not limited to working journalists. Hence, the Working Journalists Act is a special law, whereas the Payment of Gratuity Act is a general law. It is well Page No.# 5/11 settled that special law will prevail over the general law, vide G.P Singh's Principles of Statutory Interpretation, 9th Edn., 2004, pp.133 and 134."
4. Mr. S. Dutta, learned senior counsel appearing for the appellant/original respondents further relied upon the judgment of the Division Bench of this Court in WA No. 59/2015 (United Bank of India vs. Sujoy Kumar Roy ), dated 26.05.2016, whereby the Division Bench of this Court, while examining similar Regulations of United Bank of India has held that the said Regulations being specially framed, would govern the conditions of service of the employees of the bank and would override the provisions of the Payment of Gratuity Act, 1972. Mr. Dutta further contended that as the service conditions of the present respondent are governed by the provisions of the 2010 Regulations, the respondent, for being eligible for payment of gratuity, has to have the eligibility criteria as prescribed under Regulation 72(2)(d). According to Mr. Dutta, learned senior counsel for the appellant bank, as the respondent/original petitioner tendered her resignation before completing 10 years of continuous service, the respondent/original petitioner is not eligible for any gratuity as per the conditions laid down under Regulation 72(2)(d) of the 2010 Regulations. Mr. Dutta contended that the learned Single Judge, while holding that the provisions of the 2010 Regulations will have overriding effect, has committed an error in directing the appellant bank to process the case of the respondent for payment of gratuity under section 4 of the 1972 Act. With the aforesaid grounds, the learned senior Advocate for the appellant submitted that the appeal be allowed and the impugned judgment be quashed and set aside.
5. Per contra, Ms. D. Borgohain, learned counsel for the respondent/original petitioner has supported the impugned judgment and order. According to the learned counsel for the respondent/original petitioner, the learned Single Judge has rightly come to the conclusion that the respondent/original petitioner would be entitled to payment of gratuity under section 4 of the 1972 Act. Hence, no interference is called for. Relying upon a judgment of the learned Single Judge dated 18.09.2019, in WP(C) Page No.# 6/11 3086/2018 (Assam Gramin Vikash Bank and Anr. Vs. The Union of India and Ors.) and a batch of connected writ petitions as well as the judgment of the Division Bench of this Court dated 02.11.2021, in WA 112/2020 (Assam Gramin Vikash Bank and Anr. Vs. The Union of India and Ors.) and a batch of connected writ appeals , Ms. Borgohain, learned counsel for the respondent has submitted that the appeal being bereft of any merits, deserves to be dismissed.
6. No other or further submissions, grounds or contentions have been raised by the learned counsel appearing for the parties.
7. We have heard the learned counsel appearing for the parties. At the outset, it deserves to be noted that the respondent/original petitioner was appointed in the post of Junior Management Scale-I (Assistant Manager) with the appellant bank on 28.05.2012 and she resigned from the said post with effect from 03.03.2018 vide her resignation letter dated 27.11.2017. It is a matter of fact that the respondent has worked in the appellant bank for 5 years 10 months. At this juncture, it would be apt to refer to section 30 of the Regional Rural Banks Act, 1976 (hereinafter referred to as "Rural Banks Act"). The Statements of Objects and Reasons of the said Act indicate that the said Act was enacted with a view to develop the rural economy of the country. In order to ensure that the Regional Rural Banks observe the utmost economy in their functioning, it is statutorily provided that in determining the remuneration of the officers and employees appointed by the Regional Rural Banks, the Central Government shall have due regard to the salary structure of the employees of comparable level and status of the State Government and the local authorities. Section 30 of the Rural Banks Act reads thus:
"30. Power to make regulations. - (1) The Board of directions of a Regional Rural Bank may, after consultation with the Sponsor Bank and the National Bank, and with the previous sanction of the Central Government, by notification in the Official Gazette make regulations, not inconsistent with the provisions of this Act and the rules made thereunder, to provide for all matters for which provision is necessary Page No.# 7/11 or expedient for the purpose of giving effect to the provisions of this Act. (2) Every regulation shall, as soon as may be after it is made under this Act by the Board of Directors, be forwarded to the Central Government and that Government shall cause a copy of the same to be laid before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions and if before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the regulation or both Houses agree that the regulation should not be made, the regulation shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that regulation."
8. It is a matter of fact that the Board of Director of the appellant bank, in exercise of power conferred by section 30 of the Rural Banks Act, after consultation with the sponsor bank, i.e. United Bank of India and NABARD and "with the previous sanction of the Central Government (emphasis supplied)", has made the Assam Gramin Vikash Bank (Officers and Employees) Service Regulations, 2010. Thus, exhaustive Regulations have been made in the form of the service conditions of the officers and employees of the appellant bank. Regulation 72 of the said Regulations provides thus:
"72. Gratuity. - (1) An officer or employee shall be eligible for payment of gratuity either as per the provisions of the Payment of Gratuity Act, 1972 (39 of 1972) or as per sub-regulation (2), whichever is higher.
(2) Every officer or employee shall be eligible for gratuity on, -
(a) retirement,
(b) death,
(c) disablement rendering him unfit for further service as certified by a medical officer approved by the Bank, or
(d) resignation after completing 10 years of continuous service, or Page No.# 8/11
(e) termination of service in any other way except by way of punishment after completion of 10 years of service;
Provided that in respect of an employee there shall be no forfeiture of gratuity for dismissal on account of misconduct except in cases where such misconduct causes financial loss to the bank and in that case to that extent only (3) The amount of gratuity payable to an officer or employee shall be one month's pay for every completed year of service or part thereof in excess of six months subject to a maximum of 15 months' pay:
Provided that where an officer or employee has completed more than 30 years of service, he shall be eligible by way of gratuity for an additional amount at the rate of one half of a month's pay for each completed year of service beyond 30 years.
Provided further that in respect of an officer the gratuity is payable based on the last pay drawn:
Provided also that in respect of an employee pay for the purpose of calculation of the gratuity shall be the average of the basis pay (100%), dearness allowance and special allowance and officiating allowance payable during the 12 months preceding death, disability, retirement, resignation or termination of service, as the case may be."
9. Thus, the 2010 Regulations were made in exercise of the powers to make regulations, as provided under section 30 of the Rural Banks Act, as observed hereinabove. Sub-section (2) of section 30 of the Rural Banks Act further provides that every regulation shall be forwarded to the Central Government and that Government shall cause the same to be laid before each House of Parliament, while it is in session, for a total period of thirty days and when both Houses agree, the regulation shall thereafter have effect. Thus, the service conditions of the employees of the appellant bank are governed by the regulations which have passed through the test of the Parliament. The 2010 Regulations thus have a statutory force and it is a special law Page No.# 9/11 which governs the service conditions of the employees of the appellant bank. Regulation 72(1) cannot be read in isolation while considering the aspect of gratuity of an officer or an employee. Regulation 72(1) in fact provides that an officer or an employee shall be eligible for payment of gratuity as per the provisions of the 1972 Act, or as per sub-regulation (2), whichever is higher. However, for being eligible for such payment of gratuity, as provided under Regulation 72(2), every officer or employee who has resigned is required to have rendered 10 years of continuous service for being eligible for gratuity. In the case on hand, it is not the case of the respondent that she has completed 10 years of continuous service. Thus, Mr. Dutta, learned senior counsel for the appellant is correct in asserting that the 2010 Regulations, being a special law, would override the general law, i.e. the 1972 Act.
10. In the case of P. Rajan Sandhi (supra), the Apex Court observed in paragraph 11 of its judgment thus:
"11. It may be seen that there is a difference between the provisions for denial of gratuity in the Payment of Gratuity Act and in the Working Journalists Act. Under the Working Journalists Act gratuity can be denied if the service is terminated as a punishment inflicted by way of disciplinary act, as has been done in the instant case. We are of the opinion that Section 5 of the Working Journalists Act being a special law will prevail over Section 4(6) of the Payment of Gratuity Act which is a general law. Section 5 of the Working Journalists Act is only for working journalists, whereas the Payment of Gratuity Act is available to all employees who are covered by that Act and is not limited to working journalists. Hence, the Working Journalists Act is a special law, whereas the Payment of Gratuity Act is a general law. It is well settled that special law will prevail over the general law, vide G.P. Singh's Principles of Statutory Interpretation, 9th Edn., 2004, pp. 133 and 134."
11. In the case on hand also, as observed above, the 2010 Regulations, made under section 30 of the Rural Banks Act, has a statutory effect and thus the same would prevail over the provisions of the general law, i.e. the 1972 Act.
Page No.# 10/11
12. In a similar way, the Division Bench of this Court in Sujoy Kumar Roy (supra) has observed thus:
"A perusal of the Regulations of 1979 goes to show that the same had been framed in exercise of powers conferred under Section 19 read with sub-section 2 of Section 12 of the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970 by the Board of Directors of the United Bank of India. Regulations of 1979 would, therefore, have the force of a statute and would bind the bank and its employees.
Having heard the learned counsels for the parties and on an examination of the provisions of the Service Regulations of 1979, we are of the opinion that the said regulations, being specially framed to govern the conditions of service of the employees of the Bank, would over-ride the provisions contained in the Act of 1972. Therefore, the decisions cited by Mr. Medhi would be of no assistance to him in the facts of the present case. Since the respondent has been dismissed from service by way of punishment, hence, he would not be entitled to receive gratuity in view of the bar constituted by Regulation 46. As such, the direction issued by the learned Single Judge for payment of gratuity in favour of the respondent was illegal and the same is hereby set aside.
The writ appeal stands allowed.
There would be no order as to costs."
13. The judgments which are relied upon by the learned counsel for the respondent/original petitioner do not deal with the eligibility of an employee for gratuity as provided under Regulation 72(2)(d), but in all the cases, which are relied upon by the learned counsel for the respondent/original petitioner, the employees of the bank were found to be eligible for gratuity as per the 1972 Act and, hence, they were found to be entitled to the benefit of Regulation 72(1) of the 2010 Regulation. The question which arose for consideration in the aforesaid writ petitions and the writ appeals, which are relied upon by the learned counsel for the respondent/original Page No.# 11/11 petitioner, was the higher amount of gratuity to be paid to the respondent employees and, therefore, those judgments shall have no application to the facts of the present case wherein the very eligibility of the respondent/original petitioner for gratuity has been questioned as the respondent/original petitioner has, admittedly, not completed 10 years of service on her resignation but has completed only 5 years and 10 months, which disentitles her from the benefit of gratuity as provided under Regulation 72(2)
(d). Lower or higher amount of gratuity, as provided under Regulation 72(1) of the 2010 Regulation would arise only when the employee is otherwise eligible for gratuity.
14. In our considered view, therefore, even though the learned Single Judge came to the conclusion that the respondent/original petitioner would not be entitled to receive gratuity under Regulation 72(2) of the 2010 Regulation, has committed an error in directing the appellant bank to process the payment of gratuity to the respondent/original petitioner under section 4 of the 1972 Act.
15. In the light of the aforesaid, therefore, the impugned judgment and order deserves to be quashed and set aside. Accordingly, the appeal is allowed. The impugned judgment and order dated 09.03.2021, passed by the learned Single Judge in Writ Petition (Civil) No. 1697/2018, is hereby quashed and set aside.
16. Parties to bear their own costs.
JUDGE CHIEF JUSTICE Comparing Assistant