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10. The learned Single Judge after hearing all the parties by his judgment dated 12.11.2014 allowed all the Writ Petitions. The learned Single Judge held that employees  W.A. No.1 of 2015 & connected cases of the Institutes under the Council who are governed by the Rules and Regulations framed by the Council which have been made with effect from 19.06.2003 and as per Rule 14 Scientists and employees are entitled to receive the gratuity at the rate of half month's emoluments which the employee drew last for each completed year of service qualifying for gratuity. The learned Single Judge held that the Rules and Regulations as provided in Rule 14 is better condition of service for Scientists and employees of the Council and Institutes and by virtue of Section 4(5) of the 1972 Act the employees are entitled to have the benefit of better terms and conditions of service. Section 4(5) has an overriding effect on Section 4(3), hence payment of gratuity to employees cannot be with any ceiling of Rs.10 lakhs. The learned Single Judge further held that the Government have no jurisdiction to issue any direction not to pay gratuity beyond the ceiling limit of Rs.10 lakhs. The learned Single Judge held that the Rules and Regulations can be amended as per the Rules which having not done, the petitioners are clearly entitled to receive gratuity as per Rule 14. The  W.A. No.1 of 2015 & connected cases learned Single Judge further held that the internal arrangement with LIC to make payment of gratuity was an arrangement for payment of gratuity as per the convenience of the Institutes. It is submitted that the LIC has paid gratuity irrespective of any ceiling limit which is evident from the material brought on record. Premium to the LIC was paid by the Institutes and payment by the LIC was in accordance with the premium received.

15. Learned counsel for the Writ Petitioners refuting the submissions of the learned counsel for the appellants contended that ceiling of Rs.10 lakhs as prescribed by Section 4(3) is not applicable in the facts of the present case since under the Rules and Regulations, i.e., Rule 14, the Scientists and employees have been provided better terms for payment of gratuity and the ceiling under Section 4(3) shall not be applicable. It is submitted that Section 4(5) fully protected payment of gratuity to the petitioners without any ceiling. Learned Single Judge rightly held that payment has to be made without any ceiling. It is submitted that after enforcement of the Council Rules on 19.06.2003 and even before the enforcement of the said Rules, employees of the  W.A. No.1 of 2015 & connected cases Research Institutes were paid gratuity without any ceiling as prescribed under Section 4(3) of the 1972 Act. It is submitted that payment of gratuity to the petitioners of W.P(C) No.25584 of 2011 has been brought on record which indicate that in the year 2011 the LIC has issued cheque for Rs.15,37,218/- being payment of gratuity to Dr C.Renuka and cheque for Rs.15, 67,132/- to Dr George Mathew. It is stated that the Institutes have paid premium to the LIC and payment of gratuity has been made by the LIC as per the premium received, payment of which amount cannot be denied to petitioners of W.P(C) No.25584 of 2011 and other petitioners. It is submitted that Council being autonomous body and it having framed Rules and Regulations for regulating the service conditions of the employees, service conditions including payment of gratuity shall be governed by the Rules and Regulations of the Council. The State cannot issue any directions for payment of gratuity by fixing any ceiling. The learned Single Judge has rightly allowed the Writ Petitions.

"5. We do not find any justification for the appellant Bank to contend that the Policy benefit should go to the Bank. As already stated by us, LIC's Group Insurance Policy is squarely covered by S.4(5) of the Act, which excludes statutory liability by which the employer and employee can have separate arrangement for gratuity if the terms of the same are better to the employees. We have already noticed that the terms of the LIC's Group Gratuity Scheme under the Policy offered by them are advantageous to the employees by virtue of the life insurance coverage and the guarantee even in the event of liquidation of the Society. However, we do not think the employers can claim the benefit of the Group Gratuity Policy taken by them for the benefit of the employees. The appellant Bank is only a trustee, which made arrangement with the LIC by taking the policy and making payment of premium to provide gratuity and other benefits to its' employees. All the benefits under the Policy are to the account of the employees and nothing is retained by the employer, which by making payment of the premium, discharges it's annual liability for gratuity to the employees covered under the Scheme. We therefore uphold the judgment of the learned Single Judge directing the appellant to pass on the benefits received from the LIC to the respondent employees. W.A. No.197/2010 is accordingly dismissed directing the appellant Bank to forthwith pass on the differential amount received from the LIC towards the Group Gratuity Scheme to the respondent employees."

"18. In the case on hand, as borne out from the documents on record and the pleadings of both sides, the Group Gratuity Scheme with the LIC limited the maximum gratuity payable to an employee of the appellant - Bank to Rs. 3.5 Lakhs, which was the maximum limit under sub-section (3) of S.4 of the Payment of Gratuity Act during the relevant time and the LIC had collected contribution from the Bank only for covering the said statutory limit. Moreover, in Annexure - I statement of account the gratuity lying to the credit of the 1st respondent is shown as Rs. 3.5 Lakhs only. Though, on 14/05/2007, the Bank decided to request the LIC to sanction gratuity amount to its employees without any ceiling limit, the said decision was cancelled on 23/10/2007, since it attracts additional liability on account of payment of higher rate of contribution. Pursuant to the said decision, the Bank has also remitted back the excess amount of Rs. 1,86,567/- to the LIC on 12/11/2007 itself and as such no case of any unjust enrichment by the appellant - Bank could be made out in the facts and circumstances of the case pleaded by the 1st  W.A. No.1 of 2015 & connected cases respondent. The benefit available to the 1st respondent who is an employee of the appellant - Bank under the Group Gratuity Scheme with the LIC is limited to the statutory ceiling of Rs. 3.5 Lakhs, prescribed under sub-section (3) of S.4 of the Payment of Gratuity Act, during the relevant time. In the absence of a contract or agreement to receive better terms of gratuity, the 1st respondent is not legally entitled for gratuity over and above the statutory limit of Rs. 3.5 Lakhs, especially when the contribution paid by the employer is only for such statutory limit."