WIMCO LIMITED v. APPELLATE AUTHORITY UNDER PAYMENT OF GRATUITY ACT
1997-02-19
V.P.MOHAN KUMAR
body1997
DigiLaw.ai
( 1 ) THE 3rd Respondent was an employee of the petitioner. He retired on January 2, 1984. He was drawing wages exceeding Rs. 1600/- but less than Rs. 2500/ -. He was, therefore, on the date of retirement not eligible for gratuity under the Payment of Gratuity Act. Subsequent thereto on october 1, 1987, Section 2 (e) was amended whereby Rs. 1600/- was enhanced to Rs. 2500/ -. There after the 3rd Respondent filed an application contending that he is eligible for gratuity under the Act. In view of the fact that his salary at the time of retirement was less than Rs. 2500/-, the Controlling Authority, the 2nd Respondent herein, upheld the claim of the 3rd respondent and awarded gratuity in terms of the provisions of the amended Act. The matter was taken in appeal. The Appellate Authority, 1st Respondent herein, also confirmed the order. The main claim of the employee was " he is entitled to compound interest. These orders are challenged in these proceedings. ( 2 ) I have heard Smt. K. Subha Ananthi on behalf of Mr. K. Kasturi, learned counsel for the petitioner, as also Mr. T. S. Amarkumar, a learned counsel for Respondent No. 3. ( 3 ) THE short point for consideration is, whether the employee can avail of the benefit of the amendment brought into Section 2 (c) in t 1987. I am of the view the order of the authorities cannot be sustained. The contention of the learned counsel for the 3rd Respondent is that when the amendment substitutes the existing provision, it should be deemed that the substitution has been in force ever since the Act was enacted. This is not a correct proposition. It may be noted that the section as it stood prior to the amendment was that the employee should be a person who receives wages not exceeding Rs. 1600/- per mensem at the time of retirement. That is to say that the eligibility clause is that the salary should have been less than Rs. 1600/- when he continued to be an employee. The relationship of employee and employer has ceased with effect from january 2, 1984. So the right of the employee to claim gratuity came into existence on that date. In other words, the cause of action arose on that date.
1600/- when he continued to be an employee. The relationship of employee and employer has ceased with effect from january 2, 1984. So the right of the employee to claim gratuity came into existence on that date. In other words, the cause of action arose on that date. Subsequent thereto when the section was amended in 1987, he had become a quondam employee. Act 22 of 1987 was brought into effect with effect from October 1, 1987. On that date the 3rd Respondent was not an employee. It is this Act that has amended Section 2 (e) by substituting the words Rs. 1600/- with the words Rs. 2500/ -. Therefore, on the date on which the substitution was effected, the worker had ceased to be an employee but had become a quondam employee. The right of the worker arose on January 2, 1984 and the statute as it stood on that day has to be applied. Unless the statute has declared that the amendment shall be deemed to have come into force anterior to the date of retirement, the worker cannot avail the benefit of the amendment. It is further stated that in the amending act itself which states that the Act shall come into force on such date the Central Government may by Notification in the Official Gazette appoint for and different dates may be appointed for different provision of the Act. In exercise of that power, October 1, 1987 is fixed as the date on which Section 2 (e) has come into force. It means, by the time the amendment came into force, the worker has ceased to be an employee and has become a quondam employee and such employee cannot take the benefit of the amendment. Merely because he is invoking the provisions subsequent to the amendment, he cannot avail of the same. The learned counsel brought to my notice the decision of this Court reported in ILR1993 kar 2586. In particular, he relied on the following passage : "in Shri Ram Narain V. The Simla Banking And Industrial Co. Ltd AIR1956 SC 614 , [1956 ]26 Compcas280 (SC ), [1956 ]1 SCR603 it was stated that : "now there is no question about the correctness of this dictum. But it appears to us that it has no application to this case.
Ltd AIR1956 SC 614 , [1956 ]26 Compcas280 (SC ), [1956 ]1 SCR603 it was stated that : "now there is no question about the correctness of this dictum. But it appears to us that it has no application to this case. It is perfectly true as stated therein that whenever an amended Act has to be applied subsequent to the date of the amendment the various unamended provisions of the Act have to be read along with the amended provisions as though they are part of it. This is for the purpose of determining what the meaning of any particular provision of the Act as amended is, whether it is in the unamended part or in the amended part. " the upshot of this discussion is that whenever an amended Act has to be applied subsequent to the date of amendment, the various unamended provisions of the Act have to be read along with the amended provision as though they are the part of it. . . . . . . " it may be noted that the stress is clearly that "whenever an amended Act has to be applied subsequent to the date of amendment, the various unamended provisions of the Act have to be read along with the amended provision as though they are part of it. " That is to say, if the cause of action of the petitioner has arisen subsequent to the date of amendment and as the amendment has to be read thereafter, this amendment would have come to the benefit of the petitioner. In this case, obviously on the if date on which the cause of action arose,. e. , on January 2, 1984, this amendment was not in force. Merely on the ground that the amendment has been effected and an application has been made under the Payment of Gratuity Act subsequent to the date of amendment, it does not mean that the Amendment Act would apply. In such circumstances, the impugned order cannot be sustained. The writ petition is, therefore, allowed and the impugned orders are set aside. The worker is not entitled to claim gratuity under the Payment of Gratuity act, as his salary on the crucial date of retirement was Rs. 2500/- which was more than Rs. 1600/ -.