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5] Mr. Londhe, learned counsel for the respondent defended the impugned orders, by submitting that the provisions contained in Section 4(6)(b)(ii) of the said Act, apply only where an employee is convicted of an offence involving moral turpitude. In any case, the said provisions are attracted, only where "offence" as defined under Section 3 (38) of the General Clauses Act, 1897 is committed by an employee in the course of his employment. That not being the case, there arises no question of any forfeiture of gratuity amount. Further, the learned counsel submitted, that principles of natural justice and fair play are required to be followed, before any forfeiture is effected. None have been followed in the present case. The discretion that may be vested in the employer, is by no means unfettered, and can always be corrected by the controlling authority or the appellate authority under the said Act. If therefore, the two authorities have permitted forfeiture to the extent of Rs.20,000/-, even though there was no compliance with principles of natural justice before effecting of such forfeiture, the authorities cannot be said to have either exceeded their dss 6 wp 802.07-j.doc jurisdiction or exercised their powers whimsically or arbitrarily. The learned counsel also submitted that the petitioner bank, in its reply filed before the controlling authority, never disputed its liability to pay gratuity to the respondent. The only dispute raised was that the quantum of gratuity had to be determined in accordance with the BOI Gratuity Fund Rules, 1975 and not as per the said Act. Accordingly, the petitioner bank, had clearly forfeited, or in any case, waived its right to forfeit any amount from out of the respondent's gratuity. The learned counsel pointed out that it was the precise case of the petitioner bank that the BOI Gratuity Fund Rules, 1975 were applicable, though in terms thereof gratuity in an amount of Rs.95,650/- only, is payable. The Rules of 1975, do not either contemplate or permit any forfeiture. The learned counsel placed reliance upon the decisions in the case of Ramchandra S. Joshi vs. Bank of Baroda 2010-IV-LLJ-119 (Bom), Dena Bank vs. Smt. Manjulaben M. Thakor & Anr.

15] In the present case, the order of dismissing the respondent from service, makes no reference to forfeiture of gratuity. At no time thereafter, did the petitioner issue any show cause notice to the respondent or initiate any proceedings for forfeiture of gratuity. In fact, from the petitioner's response dated 18 September 2003 to the respondent's application before the controlling authority for payment of gratuity, the petitioner stated that at no stage had they denied the liability for payment of gratuity to the respondent and that under the BOI Gratuity Fund Rules, 1975, the gratuity to which the respondent would be otherwise entitled to is Rs.97,650/-, but not Rs.2,07,295.20 as claimed by him. The petitioner disputed the applicability of payments under the said Act, which they themselves assessed at Rs.1,35,869/-. From the tenor of reply, it appears that the petitioner bank was agreeable to pay to the respondent gratuity of Rs.97,650/-

vi) The Applicant has claimed an amount of Rs.2,07,295.20 as the gratuity payable to him. However, he is not entitled to that amount, even if the gratuity is calculated under the Act as well as the Rules.

The applicant in the normal course is entitled to receive the Gratuity under the Bank's rule as well as under Gratuity Act, 1972 whichever is higher. Since the applicant had completed 24 years 4 months of service (till the time of his suspension from the bank's service), he is entitled to receive 15 months gratuity under bank's Rules and for 24 years under Gratuity Act, 1972. We give below the working of two computation of Gratuity payable to the applicant in the normal course:-

dss 15 wp 802.07-j.doc This is not to say that the forfeiture has to always be commensurate to the quantum of loss in a case covered by Section 4(6)(b)(ii) of the said Act, but the quantum of loss is not an extraneous or irrelevant factor. Most importantly, the petitioner in its written statement dated 18 September 2003, had repeatedly stated that since the loss occasioned to the bank was Rs.20,000/-, the petitioner was agreeable to forfeit Rs.20,000/- and pay the balance gratuity amount to the respondent. There is no substance in the petitioner's contention that gratuity had to be determined in terms of BOI Gratuity Fund Rules, 1975. Section 4(5) of the said Act provides that nothing in the section shall affect the right of an employee to receive "better terms of gratuity" under any award, agreement or contract. If the BOI Gratuity Fund Rules, 1975 are regarded as some agreement or contract between the parties, even then, since they do not offer better terms, they cannot override the provisions of the said Act. In fact this position has been admitted by the petitioner bank in its written statement referred earlier. The material on record therefore, indicates that even the petitioner bank desired to forfeit not more than Rs.20,000/- from out of the gratuity amount payable to the respondent. Only because the respondent insisted upon payments in terms of the said Act and approached the controlling authority for enforcement, that the petitioner bank, has raised the issue of forfeiture of entire gratuity amount. Further, even if the petitioner bank, after compliance with principles of natural justice, were to order a forfeiture, the respondent would have remedy by way of approaching the controlling authority and the appellate authority, under the said Act. In the peculiar facts and circumstances of the present case, the two authorities have dss 16 wp 802.07-j.doc already ruled that forfeiture of Rs.20,000/- would meet the ends of justice. The approach of the two authorities has been balanced and there is no arbitrariness or perversity involved. The approach and conclusion of the two authorities is quite consistent with the doctrine of proportionality. In such circumstances, no useful purpose would be served by remand to the petitioner bank, at this belated stage.