Allahabad High Court
Nagar Nigam Meerut vs State Of Up And 3 Others on 21 October, 2024
HIGH COURT OF JUDICATURE AT ALLAHABAD ?Neutral Citation No. - 2024:AHC:166936 Reserved on:- 20.9.2024 Delivered on:- 21.10.2024 Court No. - 50 Case :- WRIT - C No. - 18428 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of Up And 3 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C.,Shekhar Srivastava With Case :- WRIT - C No. - 19326 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma,Shekhar Srivastava Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 18438 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 2 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 18506 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of Up And 2 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 18443 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 2 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19618 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of Up And 3 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- Ajay Rajendra,C.S.C. With Case :- WRIT - C No. - 32324 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 3 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19529 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19527 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma,Shekhar Srivastava Counsel for Respondent :- C.S.C With Case :- WRIT - C No. - 19431 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- CSC With Case :- WRIT - C No. - 19401 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma,Shekhar Srivastava Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19526 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma,Shekhar Srivastava Counsel for Respondent :- C.S.C With Case :- WRIT - C No. - 18434 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of Up And 3 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19260 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma,Shekhar Srivastava Counsel for Respondent :- CSC With Case :- WRIT - C No. - 18431 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of Up And 3 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19531 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma,Shekhar Srivastava Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19532 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- C.S.C. With Case :- WRIT - C No. - 19613 of 2024 Petitioner :- Nagar Nigam Meerut Respondent :- State Of Up And 3 Others Counsel for Petitioner :- Namit Kumar Sharma Counsel for Respondent :- Ajay Rajendra,C.S.C. With Case :- WRIT - C No. - 19533 of 2023 Petitioner :- Nagar Nigam Meerut Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Namit Kumar Sharma,Shekhar Srivastava Counsel for Respondent :- C.S.C. Hon'ble Chandra Kumar Rai,J.
1. Heard Mr. Namit Kumar Sharma, learned counsel for the petitioner, Mr. Shekhar Srivastava and Mr. Ajay Rajendra, learned counsel for respondent- employee in respective cases in which they have filed Vakalatnama and Mr. Dhananjay Singh, learned Standing Counsel for the State respondents.
2. Similar controversy are involved in all the aforementioned writ petitions, as such, all the aforementioned writ petitions are being clubbed, heard and disposed of by a common order. The facts stated in Writ C No. 18428 of 2024 shall be treating as a leading petition.
3. Brief facts of the case are that State of U.P. by means of U.P. Nagar Mahapalika Adhiniyam 1959 hereinafter shall be referred to as Act of 1959 promulgated Rules and Regulations with regard to establishment of Nagar Mahapalika/ Nagar Nigam in State of U.P. In pursuance of the aforementioned Act of 1959, Nagar Nigam Meerut has been established in District Meerut in accordance with the provisions contained under Section 548 of the Act of 1959 Meerut Nagar Nigam Karamchari Nivritt Suvidha (Retirement Benefits) Regulations 1988 hereinafter shall be referred as Regulation of 1988 has been framed. The aforementioned Regulation of 1988 was published in the Official Gazette of U.P. Government on 22.7.1988 and was made effective from 15.6.1982. Respondent no.2 was appointed as Safai Nayak/ Peon in the petitioner's organization on 18.5.1978 and retired on 30.6.2019. Respondent no.4 filed an application under Section 4 of the Payment of Gratuity Act 1972 hereinafter shall be referred as Act of 1972 on 2.11.2020 before respondent no.3/ Controlling Authority for payment of his gratuity which was registered as P.G.A. case No. 32 of 2021. Petitioner/ Nagar Nigam filed his written statement denying the allegations made by respondent no.4 stating that provisions of the Act of 1972 are not applicable upon the non-centralized employees of the petitioner's organization as well as entire claim of respondent no.4 that is retiral benefits as well as gratuity has already been paid to him as per Regulation of 1988. Respondent no.4 filed his rejoinder affidavit to the written statement reiterating the averment made by him. Parties adduced evidence in support of their cases before respondent no.3/ Controlling Authority. Respondent no. 3 vide impugned order dated 28.10.2022 allowed the application filed by respondent no.4 and directed the petitioner/ Nagar Nigam to pay the amount of gratuity @ of Rs. 3,05,269/- along with 8% simple interest from 30.6.2019 till the date of payment. In pursuance of the order dated 28.10.2022, recovery certificate has been issued on 18.10.2023 against the petitioner. Hence this writ petition for the following relief:-
"(i) Issue a writ, order or direction in the nature of certiorari to quash the impugned order dated 28.10.2022 passed by respondent no.3 in PGA case No. 32/2021 (Rizvan Ahamad Vs. M/S Nagar Nigam) as well as the impugned recovery certificate dated 18.10.2023 issued by respondent no.2 with all of its consequential effects whatsoever throughout.
(ii) Issue a writ, order or direction in the nature of mandamus commanding the concerned respondent to not to recover any amount in pursuance to the impugned order dated 28.10.2022 passed by respondent no.3 in PGA Case No. 32/ 2021 (Rizvan Ahamad Vs. M/S Nagar Nigam)."
4. This Court on 9.7.2024 passed the following interim order:-
"1.Learned counsel for the petitioner submitted that similar controversy has already been entertained by this Court in Writ-C Nos.19401 of 2023, 19326 of 2023, 19531 of 2023, 32324 of 2023, 19326 of 2023, 19431 of 2023, 19526 of 2023, 19527 of 2023, 19529 of 2023, 19532 of 2023 and interim orders have been granted, therefore the instant writ petition be connected with the aforesaid writ petitions.
2. On the other hand, learned Standing Counsel for the State-respondent submitted that there is alternative remedy against impugned order.
3. Put up this matter as fresh on 05.08.2024 along with Writ-C Nos.19401 of 2023, 19326 of 2023, 19531 of 2023, 32324 of 2023, 19326 of 2023, 19431 of 2023, 19526 of 2023, 19527 of 2023, 19529 of 2023 and 19532 of 2023"
5. In the similar manner, the other writ petitions were filed by petitioner- Nagar Nigam against the order of respondent no.3/ Controlling Authority before this Court under Article 226 of the Constitution of India without availing alternative remedy of appeal as provided under Section 7 (7) of the Act of 1972.
6. It is also material that in Writ C No. 32324 of 2023 following interim order dated 21.9.2023 was passed by this Court:-
"Heard Mr. Namit Kumar Sharma, learned counsel for the petitioner and learned Standing Counsel for State-respondents.
The writ petition has been filed assailing the order dated 30.06.2023 passed by respondent no.3 in PGA Case No.144/2019 (Jaheer Vs. M/S Nagar Nigam) and further prayer to direct the respondents not to recover any amount pursuant to impugned order.
Learned counsel for the petitioner submits that respondent no.4 after receiving the amount of gratuity as per provisions of Meerut Municipal Corporation Employees (Retirement Benefit) Regulations, 1988, at the time of his retirement, accepted an amount of Rs.5,08,100/- without raising any objection before the competent authority and after lapse of about two years seven months and twenty five days, he filed an application before the respondent no.3 u/s 4 of Payment of Gratuity Act, 1972 (for short, 'the Act, 1972'), claiming gratuity under the provisions of the Act, 1972. He further submits that once the amount of gratuity has been accepted by respondent no.4 without any protest as per terms and conditions at the relevant point of time, he cannot turn around to raise an objection for payment according to the provisions of Section 4 of the Act, 1972 that too after lapse of so many years. He further submits that non-centralized employees of petitioner's organization are getting the benefit of pension and gratuity, as provided to employees of State Government but respondent no.4 has illegally and arbitrarily after receiving the amount of gratuity in the year 2017 without any protest, has filed the application under Section 4 of the Act 1972, which is not maintainable, however, respondent no.3 without realizing the same has passed the order impugned. By the impugned order, the respondent no.3 has directed the petitioner to pay the amount of gratuity of Rs.2,54,382/- and further to pay 8% simple interest from 31.12.2016 till the date of payment made to petitioner. He further submits that respondent no.4 has accepted the amount of Rs.5,08,100/- as gratuity in the year 2017 itself as provided under the provisions of Regulations, 1988 without raising any objection and after lapse of nearly two years seven months and twenty five days he has filed the application beyond time, which has been decided without considering the objections as raised by the petitioner.
Learned counsel for the petitioner undertakes that the petitioner is ready and willing to deposit the amount of Rs.2,54,382/- before respondent no.3-Controlling Authority, under Section 4 of Payment of Gratuity Act, 1972 so that the matter may be decided after hearing the respondent no.4.
In view of above, matter requires consideration.
Issue notice to respondent no.4 returnable at an early date.
Learned counsel for the respondents are granted four weeks' time to file counter affidavit. Rejoinder affidavit, if any, may be filed within two weeks thereafter.
List this case on 03.11.2023.
As an interim measure, it is provided that the amount of Rs.2,54,382/- be deposited by the petitioner before respondent no.3 within 30 days from today which shall be kept in an interest bearing account and the disbursement whereof along with its interest would be subject to the result of present writ petition."
7. Counsel for the petitioner submitted that impugned order has been passed by Controlling Authority in illegal and arbitrary manner. He further submitted that impugned order has been passed contrary to the provisions of the Act of 1959 and Regulation of 1988. He further submitted that in view of the provisions contained under the Regulation of 1988, the workman cannot file application under Section 4 of the Act of 1972 as the Regulation of 1988 is having overriding effect upon the provisions of Act of 1972. He further submitted that non-centralized employees of petitioner's organization are getting benefit of payment and gratuity but the respondent- employees have illegally initiated the proceeding under Section 4 of the Act of 1972 which has been allowed by Controlling Authority in arbitrary manner. He further submitted that respondent no.4 has received the amount of gratuity as per provisions of Regulation of 1988 at the time of his retirement, as such, after lapse of one year and four months he cannot file application before the Controlling Authority for payment of gratuity under Section 4 of the Act of 1972. He further submitted that in view of the provisions contained under Rule 10 of the Payment of Gratuity (Centralized Rules) 1972, the claimants- employees may within 90 days of the occurrence of cause of action can apply before the Controlling Authority under Section 7 (4) of the Act of 1972 but in the instant case, the respondent- workman have applied under Section 7 (4) of the Act of 1972 on 28.8.2019 that is after one year and four months which is time barred. He further submitted that interest at the rate of 8% passed by Controlling Authority on the amount is also illegal. He further submitted that some of the writ petitions have been entertained with condition that petitioner shall deposit the awarded amount before the Controlling Authority accordingly petitioner has complied the condition under the interim order of this Court. He submitted that alternative remedy of appeal will not be bar for petitioner to file writ petition under Article 226 of the Constitution of India if the order impugned has been passed in violation of the provisions of law. He further submitted that impugned order passed by Controlling Authority be set aside and application filed by respondent-employees be rejected.
8. On the other hand, Mr. Shekhar Srivastava, learned counsel appearing for respondent- employee submitted that there is no illegality in the order of the Controlling Authority, as such, no interference is required in the matter. He further submitted that issue was framed before the Controlling Authority as to whether the provisions contained under the Act of 1972 have overriding effect over the Rules of 1984 as well as employee are entitled to the Relief under the Act of 1972. He submitted that considering the provisions of the Act of 1972 as well as the ratio of law laid down by this Court from time to time it has been held that employees of the Nagar Nigam are entitled to claim gratuity under the Act of 1972 in view of the provisions contained under Section 14 of the Act of 1972. He placed reliance upon following judgements of this Court as well as of Hon'ble Apex Court in support of his argument:-
"(i)1990 (2) LLJ 156 Nagar Palika, Moradabad Vs. Appellate Authority and Additional Labour Commissioner
(ii) Writ C No. 45310 of 2017 Nagar Nigam Gorakhpur Through Nagar Ayukt Vs. Suresh Pandey and 2 Others decided on 12.9.2019
(iii) 2019 (6) SCC 103 Nagar Ayukt Nagar Nigam Kanpur Vs. Sri Mujib Ullah Khan and Another.
(iv) 2018 (9) SCC 529 Union Bank of India and Others Vs. C.G. Ajay Babu and Another
(v) 1979 (0) Supreme (SC) 436 State of Punjab Vs. The Labour Court, Jullundur and Others
(vi) 1998 LLR 881 Supreme Court of India Municipal Corporation of Delhi Vs. Dharam Prakash Sharma and Another
(vii) 2021 (0) Supreme (SC) 78 M/s Daddy's Builders Pvt. Ltd. and Another Vs. Manisha Bhargava and Another"
9. Mr. Ajai Rajendra, learned counsel appearing for respondent- employee in some of the writ petition submitted that there is no illegality in the impugned order passed by controlling authority for payment of gratuity to the employee but order of controlling authority is appealable under Section 7 (7) of the Act of 1972, as such, writ petition is liable to be dismissed on the ground of alternative remedy. He placed reliance upon the order of this Court passed in Writ C No. 34769 of 2023 Nagar Nigam Meerut Vs. State of U.P. and 3 Others as well as judgement of Hon'ble Apex Court passed in civil appeal arising out of SLP (C) No. 8867 of 2022 P.H.R. Invent Education Soceity Vs. UCO Bank and Others dated 10.4.2024 in order to demonstrate that writ petition cannot be entertained if alternative remedy is available against the impugned orders.
10. I have considered the arguments advanced by learned counsel for the parties and perused the records.
11. There is no dispute about the fact that respondent- employees have retired from the petitioner- Nagar Nigam. There is also no dispute about the fact that respondent- employees have filed application under Section 4 of the Act of 1972 for payment of gratuity which has been allowed under impugned order. There is also no dispute about the fact that against the order impugned, the remedy of appeal under Section 7 (7) of the Act of 1972 is available but writ petition have already been entertained by this Court with certain condition.
12. In order to appreciate the controversy involved in the matter, perusal of Section 4, 7 and 14 of the Act of 1972 as well as Rule 8(1) of the Payment of Gratuity (Central) Rules, 1972 will be relevant for consideration which are as under:-
"Section- 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:
Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement:
1[Provided further that in the case of death of the employee, gratuity payable to him shall be paid to his nominee or, if no nomination has been made, to his heirs, and where any such nominees or heirs is a minor, the share of such minor, shall be deposited with the controlling authority who shall invest the same for the benefit of such minor in such bank or other financial institution, as may be prescribed, until such minor attains majority.] Explanation.-- For the purposes of this section, disablement means such disablement as incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement.
(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:
Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account:
Provided further that in the case of2[an employee who is employed in a seasonal establishment and who is not so employed throughout the year], the employer shall pay the gratuity at the rate of seven days' wages for each season.
3[Explanation.-- In the case of a monthly rated employee, the fifteen days' wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen.
(3) The amount of gratuity payable to an employee shall not exceed4[5[such amount as may be notified by the Central Government from time to time] .
(4) For the purpose of computing the gratuity payable to an employee who is employed, after his disablement, on reduced wages, his wages for the period preceding his disablement shall be taken to be the wages received by him during that period, and his wages for the period subsequent to his disablement shall be taken to be the wages as so reduced.
(5) Nothing in this section shall affect the right of an employee receive better terms of gratuity under any award or agreement or contract with the employer. (6) Notwithstanding anything contained in sub-section (1),--
(a) the gratuity of an employee, whose services have 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 employee6[may be wholly or partially forfeited]--
(i) if the services of such employee have been terminated for his riotous or disorderly conduct or any other act 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."
" Section 7 Determination of the amount of gratuity.- (1) A person who is eligible for payment of gratuity under this Act or any person authorised, in writing, to act on his behalf shall send a written application to the employer, within such time and in such form, as may be prescribed, for payment of such gratuity.
(2) As soon as gratuity becomes payable, the employer shall, whether an application referred to in sub-section (1) has been made or not, determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the controlling authority specifying the amount of gratuity so determined.
1[(3) The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable to the person to whom the gratuity is payable.
(3A) If the amount of gratuity payable under sub-section (3) is not paid by the employer within the period specified in sub-section (3), the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long-term deposits, as that Government may, by notification specify:
Provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has obtained permission in writing from the controlling authority for the delayed payment on this ground.] (4)(a) If there is any dispute as to the amount of gratuity payable to an employee under this Act or as to the admissibility of any claim of, or in relation to, an employee for payment of gratuity, or as to the person entitled to receive the gratuity, the employer shall deposit with the controlling authority such amount as he admits to be payable by him as gratuity.
3[(b) Where there is a dispute with regard to any matter or matters specified in clause (a), the employer or employee or any other person raising the dispute may make an application to the controlling authority for deciding the dispute.] 4[(c) The controlling authority shall, after due inquiry and after giving the parties to the dispute a reasonable opportunity of being heard, determine the matter or matters in dispute and if, as a result of such inquiry any amount is found to be payable to the employee, the controlling authority shall direct the employer to pay such amount or, as the case may be, such amount as reduced by the amount already deposited by the employer.] 3[(d)] The controlling authority shall pay the amount deposited, including the excess amount, if any, deposited by the employer, to the person entitled thereto.
4[(e)] As soon as may be after a deposit is made under clause (a), the controlling authority shall pay the amount of the deposit--
(i) to the applicant where he is the employee; or
(ii) where the applicant is not the employee, to the5[nominee or, as the case may be, the guardian of such nominee or] heir of the employee if the controlling authority is satisfied that there is no dispute as to the right of the applicant to receive the amount of gratuity.
(5) For the purpose of conducting an inquiry under sub-section (4), the controlling authority shall have the same powers as are vested in a court, while trying a suit, under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following matters, namely:--
(a) enforcing the attendance of any person or examining him on oath;
(b) requiring the discovery and production of documents;
(c) receiving evidence on affidavits;
(d) issuing commissions for the examination of witnesses.
(6) Any inquiry under this section shall be a judicial proceeding within the meaning of sections 193 and 228, and for the purpose of section 196, of the Indian Penal Code (45 of 1860).
(7) Any person aggrieved by an order under sub-section (4) may, within sixty days from the date of the receipt of the order, prefer an appeal to the appropriate Government or such other authority as may be specified by the appropriate Government in this behalf:
Provided that the appropriate Government or the appellate authority, as the case may be, may, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal within the said period of sixty days, extend the said period by a further period of sixty days:
6[Provided further that no appeal by an employer shall be admitted unless at the time of preferring the appeal, the appellant either produces a certificate of the controlling authority to the effect that the appellant has deposited with him an amount equal to the amount of gratuity required to be deposited under sub-section (4), or deposits with the appellate authority such amount].
(8) The appropriate Government or the appellate authority, as the case may be, may, after giving the parties to the appeal a reasonable opportunity of being heard, confirm, modify or reverse the decision of the controlling authority."
"Section 14- The provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act."
?Rule- 8(1) of the Payment of Gratuity Central Rules, 1972:- Within fifteen days of the receipt of an application under Rule-7 for payment of gratuity, the employer shall-
(i) if the claim is found admissible on verification, issue a notice in Form-L to the applicant employee, nominee or legal heir, as the case may be, specifying the amount of gratuity payable and fixing a date, not being later than the thirtieth day after the date of receipt of the application, for payment thereof, or
(ii) if the claim for gratuity is not found admissible, issue a notice in Form-M to the applicant employee, nominee or legal heir, as the case may be specifying the reasons why the claim for gratuity is not considered admissible.?
13. The perusal of Chapter VII of Section 72 of the Regulation 2010 will be relevant for perusal which is as under:-
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 (e) termination of service in any other way except by way of punishment after completion of 10 years of service:
Provide 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 months pay for every completed year of service or part thereof in excess of six months subject to a maximum of 15 month?s 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 purposes of calculation of the gratuity shall be the average of the basic 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."
13. The perusal of the finding of fact recorded by respondent no.3/ Controlling Authority will also be relevant which is as under:-
"????????? ??????????, ???????? ?????? ???????, 1972, ??? ????? ??????????, ?????
??? ?????? ????????-32/2021 ???? ?????? ???? ????????? ????? ????, ?????? ???? ??0 61. ??? ?????????? ??????, ???? ?????? ???? ???? ????? ????? ?????? ?????????/???????, ??? 8. ????? ???, ?????
????
(?) ??????- ??? ????, ??????? ????, ?????? ?????????? ??????? / ??? ???????
(2) ??????- ????????? ????? (??? ????, ???? ?? ?? ??????) ?????? ????? ????? (?????? ????????? ???????) ??? ????, ???????, ?????
???????????
??? ??????
"???? ????? ????? ???????, 1972 ?? ?????? ?????? ??? ?????? ???????????? ?????????? ??? ?????????, 1984 ?? ???????? ?? ??? ?????????? ?? ????????? ?????? ???? ??? ?? ???? ???? ?? ????? ????? ???????, 1972 ?? ??? ????? ??????? ???? ?? ?????? ??? ??? ??? ?? ???????
??????? ???? ?????????? ? ????? ?? ???? ?? ???? ???????? ?? ?? ?? ??????? ?????????? ?? ?????? ????? ???????, 1972 ?? ????????? ???? ???? ??? ??????? ???????? ?? ??? ??????? ?? ??????????? ?? ???????? ???? ?? ???? ????? ???? ??? ?????? ??? ???????? ?? ????????? ?? ????? ???? ???? ?????? ???? ??? ?? ???? ?? ????? ?? ???? ???? ???? ???? ?? ???-???? ?? ??????? ???? ???? ???? ???? ?????? ???? ????????? ?????????? ??? ??? 18-05-1978 ?? ???? ???? ?? ?? ?? ??????? ??? ?? ???? ??????? ???? ?????? ?? ?? ?? ???????? ?? ???? ???? ?????????? ?? ???? 41 ???? ???? ???? ?? ?????? ?????? 30-06-2019 ?? ??????????? ???? ???? ??????? ?? ??? ???? ?????? ???? ??0 42.672/- ???????? ??? ?? ?????? ???? ?????????? ?? ?????? ??? 10.09.357/-???? ??? ???? ?? ?????? ?? ??? ??? ????-???????? ??? ???? ??????-???? ?? ???? ???????? ????? ?? ??? ????????? ?????? ??? ?????? ???? ?? ?? ??? ?????? ??? ???? ?? ???? ???????? ?? ???? 30-06-2019 ??? ???????? ?? ???? 18-05-1978 ??? ????? ???? 41 ???? ?? ???? ???? ??????? ?? ?????????? ?? ?????? ???? 7(3) ?? ?????? ?????????? ?????? ?????? ?? ?????? ?? ???? ????? ??? ??????? ?????? ?? ???????????? ?? ???? 30-06-2019 ?? ??? 41 ???? ?? ???? ???? ??? ???-???? ??? ????????? ???? ??0 42,672/- ???????? ?? ????? ????? ???? ??????? ?? ???? ?? ???? ?? ????? ?????? ?? ???? ?? ?????????? ??? ????:-
??????- 42,672 41 15 26= 10,09,357- ????? ???????? ?????? ???? ?????? ?? ???? ??0 7,04,088/- ?????? ????? ??? ???? ???? ??? ???? ?????? ???? ?????? ??????? ???? ???? ??????? ???? ??? ??? ?????? ??? ?????????? ???? ??? ?? ?????? ?? ?? ?????? ????? ???? ????? ?????? ??0 3.05.269/- ??? ???? ???? ???? ??? ???? ???? ???????? ?? ??????? ???? ?? ??????? ?? ?
????????? ?????? ??? ????, ???? ?????? ??????? ?? ?????? ??? ?????? ??? ?? ?????? ???? ???? ?? ?? ???? ?????? ? ???? ?? ???? ?? ?? ????? ????? ???? ?? ????? ????????? ??????? ?? ???? 7 (??) ?? ?????? ????? ?? ???? ?? ????????? ????? ????????? ???? ?? ???? ??????? ?? ?????? 30-06-2019 ?? ?? ??? ??????? ?? ?????? ??? ???? ?? ???? ?? 08 ??????? ?????? ????? ?? ?? ?? ?????? ??? ???? ????????? ?????
- ???? :-
????????? ?????? ??? ????, ???? ?????? ??? ?????? ?? ??????? ???? ???? ?? ?? ?? ???? ???? ?????? ???? ????? ???? ???? ???? ?? ????? ?????????? ?????? ??0 3,05,269 / ??? ??? ?? ???? ??????? ?? ??? 30-06-2019 ?? ?? ??? ??????? ?? ?????? ??? ???? ?? ???? ?? 08 ??????? ?? ?? ?? ?????? ????? ?? ???? ??? ???? ????????? ????? ????????? ???? ???? ????? ?? ?????? ?????? ?? ???? ????? ???? ?? ???? ?? 30 ??? ?? ????? "?? ??????????, ??????, ???? ?? ??? ???? ??????? ?? ?????? ?? ?? ???????? ??? ??? ?????
????????? ???? ?????? ???? ???? ?? ??????? ?? ???? ?? ?????? ??? ???? ??????? ?????????? ???????? ?? ????????? ???? ?? ??????
??? ???? ??? ???? ???? ??? ???????
?? ???? ???? ????????? ??? ?????? ???? ?? ?????? 28-10-2022 ?? ????? ???? ????
?????? 28.10.2022 ?????- ?????
?? ??????
(??????? ????) ???????? ??????????
???????? ?????? ??????? 1972 ??? ????? ?????????? ?????"
14. The perusal of the finding of fact under impugned order demonstrate that respondent- employees in leading writ petition has worked for 41 years in the petitioner- Nagar Nigam, as such, he will be entitled for Rs. 10,09,357/- and the amount of 7,00,488/- has already been paid to the respondent- employee, as such, respondent- employees will be entitled for Rs. 3,05,269/- along with 8% simple interest from the date of retirement from service that is 30.6.2019 till the date of payment which is correct exercise of jurisdiction by Controlling Authority under the Act of 1972.
15. Hon'ble Apex Court in the case of Nagar Ayukt Nagar Nigam Kanpur (Supra) has cited by learned counsel for the respondent-employees has held that in view of the provisions contained under Section 14 of the Act of 1972, the provisions in the State Act contemplating the payment of gratuity will be inapplicable in respect to the employees of the local bodies. Paragraph Nos. 11,12,13,14 and 15 of the judgement of Hon'ble Apex Court rendered in Nagar Aayukt Nagar Nigam Kanpur (Supra) will be relevant for perusal which are as under:-
"11. We find that the Notification dated 8.1.1982 was not referred to before the High Court. Such notification makes it abundantly clear that the Act is applicable to the local bodies i.e. the Municipalities. Section 14 of the Act has given an overriding effect over any other inconsistent provision in any other enactment. The said provision read as under:-
"14 Act to override other enactments, etc.- The provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act."
12. In view of Section 14 of the Act, the provision in the State Act contemplating payment of gratuity will be inapplicable in respect of the employees of the local bodies.
13. Section 2 (e) of the Act alone was referred to in the judgement reported as MCD. The said judgement is in the context of the CCS (Pension) Rules, 1972, which specifically provides for payment of pension and gratuity. The Act is applicable to the Municipalities, therefore, it is wholly inconsequential even if there is no reference to the Notification dated 8.1.1982.
14. The entire argument of the appellant is that the State Act confers restrictive benefit of gratuity than what is conferred under the Central Act. Such argument is not tenable in view of Section 14 of the Act and that liberal payment of gratuity is in fact in the interest of the employees. Thus, the gratuity would be payable under the Act. Such is in the view taken by the Controlling Authority.
15. In view of the aforesaid, we find that there is no error in the orders passed by the Controlling Authorities under the Act and as maintained by the High Court. Consequently, the appeals are dismissed."
16. This Court in the bunch of writ petition filed by Nagar Nigam Gorakhpur has adjudicated the similar controversy in the case of Nagar Nigam Gorakhpur (Supra) vide detailed judgement dated 12.9.2019 considering the judgement of Hon'ble Apex Court in Nagar Ayukt Nagar Nigam Kanpur (Supra) as quoted above. Paragraph Nos. 59, 60, 71, 72 and 73 of the judgement of this Court rendered in Nagar Nigam Gorakhpur (Supra) will be relevant for perusal which is as under:-
"59. The P.G. Act, 1972 being thus a welfare legislation meant for the benefit of the employees who serve their employer for a long time, it would be the duty of the employer to pay gratuity amount to the employee rather than denying the benefit on some technical ground.
60. Applying the rule of beneficent construction, the provisions of the P.G. Act, 1972 are to be interpreted liberally so as to give it a wide meaning rather a restrictive meaning which may negate the very object of the enactment. A beneficial legislation, it is well settled, as to be construed in its correct perspective so as to fructify the legislative intent underlying its enactment.
61. In construing a remedial statute courts are to give it the widest amplitude which its language would permit. The principle of applying a liberal construction to a remedial legislation has been emphasised in the Construction of Statues by Crawford19 pp. 492-493 in the following terms:-
"...Remedial statutes, that is, those which supply defects, and abridge superfluities, in the former law, should be given a liberal construction, in order to effectuate the purposes of the legislature, or to advance the remedy intended, or to accomplish the object sought, and all matters fairly within the scope of such a statute be included, even though outside the letter, if within its spirit or reason."
62. To a similar effect is the observation made by Blackstone in Construction and Interpretation of Laws20, by stating as under:-
"It may also be stated generally that the courts are more disposed to relax the severity of this rule (which is really a rule of strict construction) in the case of statutes obviously remedial in their nature or designed to effect a beneficent purpose."
63. In the context of beneficial construction as a principle of interpretation, it has been observed in Maxwell on The Interpretation of Statutes21 as follows:-
"...where they are faced with a choice between a wide meaning which caries out what appears to have been the object of the legislature more fully, and a narrow meaning which carries it out less fully or not at all, they will often choose the former. Beneficial construction is a tendency, rather than a rule."
64. Further, in the same treatise, in the context of industrial legislation, it has been stated as follows:-
"Industrial legislation provides a fruitful field for the application of the tendency towards beneficial construction..."
65. The principle of applying a liberal construction to a labour welfare legislation was emphasised in the case of The Workmen of M/s Firestone Tyre & Rubber Company of India Pvt. Ltd. Vs. The Management & Ors.22 where in the context of the provisions of the Industrial Disputes Act, 1947, it was observed as follows:-
"35. ...We are aware that the Act is a beneficial piece of legislation enacted in the interest of employees. It is well settled that in construing the provisions of a welfare legislation, courts should adopt, what is described as a beneficent rule of construction. If two constructions are reasonably possible to be placed on the section, it follows that the construction which furthers the policy and object of the Act and is more beneficial to the employees, has to be preferred..."
66. The mode of interpretation of a social welfare legislation, in the context of the provisions of the Industrial Employment (Standing Orders) Act, 1946, came up for consideration in the case of B.D. Shetty & Ors. Vs. CEAT Ltd. & Anr.23, and it was held as follows:-
"12. ...a beneficial piece of legislation has to be understood and construed in its proper and correct perspective so as to advance the legislative intention underlying its enactment rather than abolish it. Assuming two views are possible, the one, which is in tune with the legislative intention and furthers the same, should be preferred to the one which would frustrate it."
67. The principle of applying a liberal construction to a beneficial legislation having a social welfare purpose was reiterated in the context of the P.G. Act, 1972 in the case of Allahabad Bank & Anr. Vs. All India Allahabad Bank Retired Employees Association24, and it was observed as follows:-
"16. ...Remedial statutes, in contradistinction to penal statutes, are known as welfare, beneficent or social justice oriented legislations. Such welfare statutes always receive a liberal construction. They are required to be so construed so as to secure the relief contemplated by the statute. It is well settled and needs no restatement at our hands that labour and welfare legislation have to be broadly and liberally construed having due regard to the directive principles of State policy. The Act with which we are concerned for the present is undoubtedly one such welfare oriented legislation meant to confer certain benefits upon the employees working in various establishments in the country."
68. A similar view was taken with regard to adopting the beneficial rule of construction in respect of social welfare legislation, particularly in the context of the P.G. Act, 1972 in the case of Jeewanlal Ltd. & Ors. Vs. Appellate Authority under the Payment of Gratuity Act & Ors.25, wherein it was stated as follows:-
"11. In construing a social welfare legislation, the court should adopt a beneficent rule of construction ; and if a section is capable of two constructions, that construction should be preferred which fulfils the policy of the Act, and is more beneficial to the persons in whose interest the Act has been passed..."
69. Reference may also be had to the case of Bharat Singh Vs. Management Of New Delhi Tuberculosis Centre, New Delhi & Ors.26, where purposive interpretation safeguarding the rights of have-nots was preferred to a literal construction in interpreting a welfare legislation, and it was held as follows:-
"11....the court has to evolve the concept of purposive interpretation which has found acceptance whenever a progressive social beneficial legislation is under review. We share the view that where the words of a statute are plain and unambiguous effect must be given to them. Plain words have to be accepted as such but where the intention of the legislature is not clear from the words or where two constructions are possible, it is the court's duty to discern the intention in the context of the background in which a particular Section is enacted. Once such an intention is ascertained the courts have necessarily to give the statute a purposeful or a functional interpretation. Now, it is trite to say that acts aimed at social amelioration giving benefits for the have-nots should receive liberal construction. It is always the duty of the court to give such a construction to a statute as would promote the purpose or object of the Act. A construction that promotes the purpose of the legislation should be preferred to a literal construction. A construction which would defeat the rights of the have-nots and the underdog and which would lead to injustice should always be avoided..."
70. The aforementioned position of law has been discussed in a recent judgment of this Court in U.P.S.R.T.C. Thru Its R.M. Vikasnagar Kanpur Vs. State Of U.P. And 3 Others27.
71. In the case at hand, the provisions of the P.G.Act, 1972 having been made applicable to local bodies which includes Municipal Corporations in terms of the notification dated 08.01.1982 issued by the Central Government in exercise of powers conferred under Section 1 (3) (c) the same would be applicable to the employees governed by Regulations 1990 in the absence of any exemption notification having been issued with regard to the petitioner-establishment under Section 5 and it will have an overriding effect by virtue of Section 14 over any scheme which is less favourable to the said employees.
72. Counsel appearing for the petitioner has not been able to dispute the aforementioned legal proposition and has not been able to point out any material error or irregularity in the orders passed by the Controlling Authority and the Appellate Authority so as to warrant interference in exercise of powers in writ jurisdiction under Article 226 of the Constitution of India.
73. The writ petitions lack merit and are accordingly dismissed."
17. So far as the alternative remedy of appeal under Section 7 (7) of the Act of 1972 is concerned, since several writ petitions in the aforementioned bunch has been filed by Nagar Nigam in the year 2023 which have been entertained passing the interim order with condition that petitioner- Nagar Nigam shall deposit the principal amount before the Controlling Authority, as such, it will not be proper to dismiss the writ petition on the ground of alternative remedy of appeal as provided under Section 7 (7) of the Act of 1972.
18. It is also material that respondent- employee in all the petitions have already retired, as such, they will not be thrown in litigation further by sending them to contest the proceeding of appeal before the Appellate Authority rather to adjudicate the issue on merit. Hon'ble Apex Court as well as this Court has already adjudicated the controversy with respect to payment of gratuity to the employee of Nagar Nigam, as such, there is no necessity to send the matter before the appellate Court for adjudication.
19. It is also material that payment of gratuity is not charity rather is a statutory right recognized by the Act.
20. Considering the entire facts and circumstances of the case, no interference is required against the impugned orders passed by Controlling Authority under Section 4 of the Act of 1972 in the respective cases. All the aforementioned writ petitions are dismissed. Petitioner is directed to pay the amount which has been ordered by Controlling Authority under the impugned orders in favour of respondent-employees within period of two months from the date of production of certified copy of this order before him.
21. No order as to costs.
Order Date :- 21.10.2024 Vandana Y.