Delhi High Court
Delhi Transport Corporation vs Dhanwant Rai And Ors. [Along With Lpa No. ... on 6 September, 2007
Author: Mukundakam Sharma
Bench: Mukundakam Sharma, Sanjiv Khanna
JUDGMENT Mukundakam Sharma, C.J.
1. As the issues involved in these appeals are identical, we propose to dispose of these appeals by this common judgment and order.
2. The appellant is aggrieved by the order dated 20th September, 2004, passed by the learned Single Judge directing for payment of retirement benefits like gratuity, leave encashment, unpaid salary etc to the respondents. The appellant, namely, Delhi Transport Corporation, did not pay the aforesaid retiral benefits to the respondents on the pretext that the respondents have not vacated the residential accommodations provided by the Corporation.
3. The principal question that was urged and decided by the learned Single Judge was whether an employer can withhold retiral benefits of a retired person, who has no proceedings pending against him, on the ground that the retiree continues to be in occupation of the accommodation provided by the employer. The learned Single Judge held that the Corporation could not have withheld the payment of gratuity on account of non-vacation of government allotted accommodation and non-production of no due certificate. While coming to the aforesaid conclusion the learned Single Judge referred to the provisions of Section 7 of the Payment of Gratuity Act. Sub-section (2) of Section 7 mandates that the employer shall determine the gratuity amount payable irrespective of the fact as to whether any application to that effect is made or not. It further mandates issue of notice in writing to the employee as well as the controlling authority of the amount so determined. Sub-section 3 makes a statutory provision for payment of interest. Payment of interest could be exempted only if the delay is on account of some default on the part of the employee.
4. Relying on the said provision it was submitted by the counsel appearing for the appellant that the respondents continued to be in unauthorised occupation of the accommodation allotted to them by the Corporation and, therefore, they cannot ask for payment of retiral benefits. In support of the said contention Mr.J.N.Aggarwal, the learned Counsel appearing for the appellants, relied upon a decision of the Supreme Court in Secretary, ONGC Ltd. and Anr. v. V.U. Warrier . Paragraph 17 of the said judgment was referred to and therefore we would like to extract relevant portion of the said paragraph, which is as follows:
17. Having heard the learned Counsel for the parties, in our opinion, the appeals deserve to be allowed. It is no doubt true that pensionary benefits, such as gratuity, cannot be said to be `bounty'. Ordinarily, therefore, payment of benefit of gratuity cannot be withheld by an employer. In the instant case, however, it is the specific case of the Commission that the Commission is having a statutory status. In exercise of statutory powers under Section 32(1) of the Act, regulations known as the Oil and Natural Gas Commission (Death, Retirement and Terminal Gratuity) Regulations, 1969 have been framed by the Commission. In Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi and Anr. the Constitution Bench of this Court held that regulations framed by the Commission under Section 32 of the Oil and Natural Gas Commission Act 1959 are statutory in nature and they are enforceable in a court of law. They provide for eligibility of grant of gratuity, extent of gratuity, etc. Regulation 5 deals with recovery of dues of the Commission and reads thus:
5. Recovery of Dues - The appointing authority, or any other authority empowered by the Commission in this behalf shall have the right to make recovery of Commission's dues before the payment of the death-cum retirement gratuity due in respect of an officer even without obtaining his consent or without obtaining the consent of the members of his family in the case of the deceased officer, as the case may be.
The above regulation leaves no room for doubt that the Commission has right to effect recovery of its dues from any officer without his consent from gratuity....
5. We have considered the submissions of the counsel appearing for the parties including the counsel for the respondents who has relied upon the decision of the Supreme Court in R. Kapur v. Director of Inspection (Painting and Publication) Income Tax and Anr. (1994) 6 SCC 189 and also the decision of the Supreme Court in Gorakhpur University and Ors. v. Shitla Prasad Nagendra and Ors. . Another decision on which reliance is placed is H. Gangahanume Gowda v. Karnataka Agro Industries Corpn. Ltd . The aforesaid decisions which are relied upon by the learned Counsel for the respondents are also referred to and relied upon in the decision of the Supreme Court in the case of V.U.Warrier (supra). In paragraph 22 of the said judgment R.Kapur's case(supra) is referred to. It was held that the said decision was not helpful to the respondent in that case, namely V.U.Warrier, inasmuch as the claim for damages for unauthorised occupation against the retired employee in R.Kapur's case (supra) was "pending" and the proceedings were not finally disposed of. In V.U.Warrier's case (supra) the proceedings for damages and unauthorised occupation had been decided.
6. In the present case notices were issued to the respondents directing them to vacate the official accommodation. Admittedly, no proceedings under the Public Premises(Eviction of Unauthorised Occupants) Act have been initiated by the appellant against the respondents. There was a legal dispute between the appellant and the respondents whether their occupation of the properties is legal and valid, in view of a resolution of the Board of Directors of the Corporation deciding to allot quarters to the employees of the Corporation. It is stated that in 2006 the issue was decided by the Supreme court in favor of the Corporation, reversing the judgment of the Delhi High Court. Whether the respondents are entitled to retain the official accommodation and whether they can become owners of the said premises is not a matter to be considered in these proceedings. The present case revolves around the only issue as to whether or not a person would be entitled to retiral benefits on retirement, irrespective of the fact that he has failed to vacate the official accommodation. In our considered opinion the decision of the Supreme Court in the case of V.U.Warrier is an answer to the issues raised by the counsel appearing for the appellant. In that decision the Supreme Court held that ordinarily payment of benefit of gratuity cannot be withheld by an employer but if in a particular case such withholding of payment of gratuity is permissible by any statutory provision in Act or Regulation, in that event only such payment could be withheld as provided in paragraph 17 of the said judgment. We consider that the aforesaid case instead of helping the appellant helps the respondents, once a reference is made to the observations of the Supreme Court in paragraph 22. Ratio of R.Kapur's case (supra) will apply in the present case. The appellant is yet to initiate proceedings for eviction and damages. No amount payable by the respondents has been adjudicated. No amount has become due and payable as of today by the respondents to the appellant, as no proceedings under the Public Premises (Eviction of Unauthorised Occupants) Act have been initated against the respondents and, therefore it cannot said that as of now some amount is due and payable by the respondents to the appellant for unauthoried occupation of the official accommodation. Para 22 of the judgment in V.U.Warrier's case (supra) is applicable.
7. In this view of the matter, we find no reason to interfere with the order passed by the learned Single Judge. The appeal has no merit and is dismissed.