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1989 DIGILAW 460 (MAD)

The Management of Madura Coats Ltd. v. The Appellate Authority Under The Payment of Gratuity Act

1989-09-21

SRINIVASAN

body1989
ORDER Srinivasan, J. 1. In these two writ petitions the common order passed by the Appellate Authority under the Payment of Gratuity Act is being challenged. The facts are similar in both the cases. The third respondent in each of the petitions resigned from service and applied for gratuity. The amounts claimed by them were paid in full by the writ petitioner. After some time, they filed applications before the second respondent claiming that they would be entitled to some more amounts by way of gratuity and there was some error in the calculations when they claimed gratuity from the writ petitioner. The applications were opposed by the writ petitioner on the following three grounds: (i) The applications were barred by limitation, (ii) The applicants were estopped from making any claim for further amounts of gratuity, they having received the amounts already claimed by them from the employer; and (iii) The applicants were not entitled to any extra amount by way of gratuity as claimed by them. All the three contentions were found against the writ petitioner by the second respondent in his order dt. 30-4-1981. On appeal by the writ petitioner, third respondent confirmed the order of the second respondent, by order dated 12-3-1982. it is the order of the third respondent which is called in question in these writ petition. 2. Learned Counsel for the writ petitioner con fined his submissions to the question of limitation. He invited our attention to the relevant rules providing for periods of limitation. Rule 7 of/the Payment of Gratuity (Central) Rules, 1972, pro- vides that an employees who is eligible for payment of gratuity shall apply ordinarily within thirty days from the date gratuity became payable in Form(I) to the employer. Sub-rule (4) of Rule 7 is to the effect that the periods of limitation specified in Sub-rule(1), (2) and (3) shall be deemed to be operative from the date of commencement of the Rules, where gratuity became payable be fore such commencement. Sub-rule (5) reads that an application filed after the expiry of the periods specified in the Rule shall also be maintained by the employer, if the applicant adduces sufficient cause for the delay in preferring his claim and no claim for gratuity under the Act shall be invalid merely because the claimant failed to make his application within the specified period. The said Sub-rule also provides that any dispute in that regard shall be referred to the Controlling Authority for his decision. Rule 8 provides for notice for payment of gratuity and prescribes the time limits there for Rule 9 deals with the mode of payment of gratuity; and Rule 10 deals with application to the Controlling Authority for direction. Under Rule 10, if an employer refuses to accept a nomination or to entertain an application filed under Rule 7 or issues a notice under Sub Rule (1) of Rule 8, either specifying an amount of gratuity less than that payable to the applicant or rejecting the eligibility of the applicant to gratuity or fails to issue any notice as required under Rule 8 within the time specified therein, the employee may within ninety days of the occurrence of the cause for the application, apply in Form 'N' to the Controlling Authority of Section 7. Section 7(4) of the Act enables the Controlling Authority to decide any dispute as to the amount of gratuity payable to an employee or the admissibility of any claim of an employee to any gratuity and other disputes between the employer and the employee. 3. In this case, the employees, instead of approaching the writ petitioner with claims for additional amounts, which according to them they are entitled to by way of gratuity, filed applications straightaway before the second respondent under Form 'N'. Learned Counsel contends that such applications are not maintainable as the Rules prescribe that in the first instance, the employee should approach the employer. According to him, having failed to apply to the employer within the time prescribed by the Rules, it is not open to the employee to approach the authority with an application under Form 'N'. Thus, the applications before the authority are very much beyond the time prescribed under Rules, for making an application for gratuity to the employer. According to the learned Counsel, the employee cannot circum vent the procedure/prescribed in the Rules and apply to the authority under the Act straight away beyond the time limit specified in the Rules. 4. Though learned Counsel argued it as a question of limitation, it is really one of maintainability of the applications before the concerned author it. According to the learned Counsel, the employee cannot circum vent the procedure/prescribed in the Rules and apply to the authority under the Act straight away beyond the time limit specified in the Rules. 4. Though learned Counsel argued it as a question of limitation, it is really one of maintainability of the applications before the concerned author it. On the facts, the authorities have found that the employees had sufficient cause for not approaching them within the time limit specified under the Rules. In the case of one employee viz., KAlagarsamy, third respondent in W.P.No. 9442 of 1982, he had filed a petition before the Labour Court wrongly making the same claim and the Labour Court returned the petition stating that it had no jurisdiction to entertain the same. The returned petition is marked as Ex. A-2. The explanation given by third respondent in W.P. No. 9442 of 1984 was thus accepted by the second respondent. As regards the other employee viz., S.Alagarasamy Naidu, third respondent in WP No. 9465 of 1982, he retired on 1-1-1977 and filed the application under Form 'N' on 22-5-1987, i.e., within a period of five months. The reason given by him was that he had to be away from station on account of family affairs. This explanation was also accepted by the second respondent. 5. Sitting in writ jurisdiction, we cannot interfere with the acceptance of the explanations rendered by the employees to the second respondent. 6. However, the question of maintainability of the applications before the concerned authority will have to be decided. In our view, it is a hyper-technical contention. No doubt, the rule provides for the employee approaching the employer in the first instance in order to save himself from the expenses of instituting a proceeding before the authority and in order to avoid the delay which may be caused if an application is filed before the concerned authority. If the employer had refused to accept the claim of the employee, the remedy of the employee is to approach the concerned authority. Just because the employees had not approached the employer and instead went to the authority straight, it does not mean that the applications would not be maintainable in law. On the facts of this case, the employees had already made a claim with the employer and the employer had already paid the amount claimed by them. Just because the employees had not approached the employer and instead went to the authority straight, it does not mean that the applications would not be maintainable in law. On the facts of this case, the employees had already made a claim with the employer and the employer had already paid the amount claimed by them. Probably, the employees were of the opinion that any further Claim with the employer would not meet with success and, therefore, they approached the authority straightaway. It could be construed as a negation of the claim by the employer for the balance. amount now claimed, when the employer paid the amount originally claimed by the employ fees, though it was not the correct amount. No doubt, it Was a case of only mistaken calculation and not any deliberate or mala fide refusal to pay the amount claimed by the employees. But in the circumstances of the case, it could be taken as a bona fide failure on the part of the employer to pay the amount actually due under the law to the employees and the employees can be said to be entitled to approach the authority for the balance amounts. Moreover, it is not a case of want of jurisdiction. If at all, the applications can only be said to be premature, but having regard to the fact that the writ petitioner contested the claims on merits also before the authorities, it can be said that the petitioner would have rejected the claims of the employees, if they had gone to him with their applications. Viewed in that light, the applications filed by the employees before the second respondents are maintainable under the provisions of the law, and the contention put forward by learned Counsel for the petitioner has to be rejected. 7. In the result, the writ petitions are dismissed with costs. Advocate fee Rs. 500 one set.