ORDER : Ruma Pal, A.R. Lakshmanan, JJ. Leave granted. The respondent had joined the appellant's service sometime in 1965. He retired from service in 1985. Prior to his joining ONGC the respondent had been serving with a Central Government institute, namely, the Institute of Sugarcane and Research, Lucknow. On the retirement of the respondent, he continued to remain in occupation of the official quarters for a period of about four-and-a-half years. The appellant sought to deduct the amount by way of penal rent in respect of the unauthorised occupation of the official quarters from the gratuity payable by the appellant to the respondent. The appellant also calculated the benefits due to the respondent on the basis of the 1969 Regulations of the appellant which provided for the service conditions in respect of death, retirement and terminal gratuity. 2. The respondent filed a writ petition before the High Court in which it was contended: (0 that the appellant could not deduct penal rent from gratuity payable to the respondent, (ii) that the dues of the respondent were to be calculated under the Payment of Gratuity Act and not under the 1969 ONGC Regulations, and (iii) that the respondent was entitled to pro rata payment of his pensionary benefits from the Central Government for the period of his services with the Central Government. 3. As far as the third issue is concerned, it was not disputed by the Central Government before the High Court and, accordingly, the High Court directed that the Central Government authorities would be liable to pay the pro rata pension to the respondent upon his retirement from the appellant. This has not been challenged by the Central Government before us. That finding of the High Court, therefore, has become final. 4. As far as the first issue is concerned, the High Court held that while rent could be deducted from the gratuity, the penal rent could not be deducted. In view of this Court's decision in ONGC Ltd. v. V.U. Warrier, (2005) 5 SCC 245 this conclusion of the High Court must be held to be wrong. It was open to ONGC to deduct the penal rent from the gratuity payable to the respondent. 5. This leaves the final issue, namely, as to whether the Payment of Gratuity Act or the ONGC Regulations would apply. According to the High Court the Payment of Gratuity Act would prevail.
It was open to ONGC to deduct the penal rent from the gratuity payable to the respondent. 5. This leaves the final issue, namely, as to whether the Payment of Gratuity Act or the ONGC Regulations would apply. According to the High Court the Payment of Gratuity Act would prevail. The learned counsel appearing on behalf of the respondent has also relied upon the decision of this Court in Som Prakash Rekhi v. Union of India, (1981) 1 SCC 449 to contend that by virtue of the non obstante provision, Section 14 of the Payment of Gratuity Act would prevail over any other regulation which may have been enacted in this respect. 6. The learned counsel appearing on behalf of the appellant, however, states that the benefits which have already been paid to the respondent under the 1969 ONGC Regulations are in fact much higher than those to which the respondent would be entitled to under the Payment of Gratuity Act. He has also relied upon the decision in EID Parry (I) Ltd. v. G. Omkar Murthy, (2001) 4 SCC 68 to contend that the employee was entitled to the benefits under the Regulations provided the Regulations were more beneficial to the employee than the Payment of Gratuity Act. 7. Additionally, the appellant has sought to raise a ground for the first time before this Court and has filed a separate application in order to grant permission to the appellant to raise this ground. According to the additional ground the Payment of Gratuity Act would not, in any event, apply to the respondent by reason of the definition of "employee" in Section 2(e) of that Act. Section 2(e) as it existed at the relevant point of time made it clear that it would only apply to an employee who was not drawing above Rs. 1600 p.m. by way of salary. In the present case, admittedly, the respondent was drawing above Rs. 4000 p.m. by way of salary. 8. This issue would, of course, become academic if the respondent would withdraw his grievance on the ground that more beneficial provisions are contained in the 1969 ONGC Regulations which should be made applicable to the respondent. The learned counsel appearing on behalf of the respondent seeks a short adjournment for the purpose of ascertaining this particular position. The matter is adjourned to Friday fortnight.