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2015 DIGILAW 1237 (KAR)

State of Karnataka v. Sathya

2015-11-09

S.SUJATHA

body2015
ORDER : S. Sujatha, J. 1. Petitioners have called in question the order passed by the 2nd respondent in case No. SaKaAaMy/PGA/CR-63/2008 dated 24.4.2010 (Annexure-A) and the order passed by the 3rd respondent in case No. UKaAa-2/PGA/CR-105 to 120/2010-11 dated 22.10.2011 (Annexure-B), whereby the appeal filed by the 2nd petitioner under Section 7 of the Payment of Gratuity Act, 1972 (hereinafter referred to as 'the Act') has been dismissed. 2. Heard learned counsel appearing for the parties. 3. The 1st respondent herein filed an application under Section 7(4) of the Act claiming that he joined the petitioners' department on 6.10.1956 as water boy and retired on 31.10.2000. He was drawing salary of Rs. 4,375/- p.m. and when he retired, he was entitled for gratuity amount of Rs. 1,11,057/-. The Controlling Authority i.e., the 2nd respondent, after adjudication of the claim, allowed the application and ordered that the 1st respondent is entitled for a total sum of Rs. 1,76,334/-. Aggrieved by the said order, the 2nd petitioner preferred an appeal in case No. UKaAa-2/PGA/CR-105 to 120/2010-11 before the Appellate Authority. The Appellate Authority dismissed the appeal on the ground that the appellant has not deposited the admitted payment of gratuity under Section 7(7) of the Act. It is these orders, which are impugned in this writ petition. 4. It is submitted by the learned AGA that this Hon'ble Court in identical circumstance in the case of ASSISTANT EXECUTIVE ENGINEER v. J. MAHADEVAIAH AND ANOTHER reported in ILR 2004 KAR 225 and in W.P. No. 43197/2011 in the case of THE STATE OF KARNATAKA AND ANOTHER v. SRI. R. PRAKASH BIN RANGAPPA has held that the definition of the term 'employer' as defined under section 2(f) of the Act mandates that the State was required to be made as party to the proceedings before the jurisdictional authority, so that the State would have got an opportunity to defend its claim. It is admitted fact that the State was not made a party before the 2nd respondent and as such, the State had no knowledge of the proceedings before the 2nd and 3rd respondents and accordingly, the said orders would not be binding on the State. It is submitted by the learned AGA that in view of the said judgments passed by this Court, this writ petition requires to be allowed. It is submitted by the learned AGA that in view of the said judgments passed by this Court, this writ petition requires to be allowed. It is also contended by the learned AGA that the 1st petitioner has deposited the amount of Rs. 2,45,398/- before the 2nd respondent on 30.3.2014. 5. On the contrary, learned counsel for the respondents has vehemently contended that the 2nd petitioner, who was an appropriate party to deal with the payment of gratuity, was made as party and the 1st petitioner State is not a necessary or proper party to the proceedings to be impleaded in the proceedings. He has further contended that the judgment of the Division Bench of this Court in J. Mahadevaiah's case (supra) and more particularly, the judgment of the learned Single Judge of this Court in Prakash Bin Rangappa's case (Supra) is not applicable to the facts of this case. 6. Having heard the learned Counsel for the parties and perusing the materials placed on record, it is noticed that the Division Bench of this Court in case of J. Mahadevaiah's case (Supra) has categorically held thus: (51) "If the 'employer' as defined is not impleaded and only a subordinate who is not authorized to represent the State/Local Authority will be entitled to challenge the award as not binding on them as they did not have an effective opportunity to defend the claim, and in some cases, they may also contend that the Award is not executable against them. In that event the Union or the workmen concerned may have to establish that the concerned authority authorized to represent the State/ Local Authority had notice and knowledge of the proceedings and had in fact contested the matter before the Labour Court through the person impleaded as party". The Co-ordinate Bench of this Court in Sri.R. Prakash Bin Rangappa case (Supra) has held thus: "Having regard to the definition of the term 'employer' as defined under Section 2(f) of Payment of Gratuity Act, it would emerge that State was required to be made as a party to the proceedings before the jurisdictional authority i.e., 3rd respondent so that State would have got an opportunity to defend the claim and place all its defence including the issue regarding maintainability of claim. In view of the admitted fact that State was not made a party before the 3rd respondent in the proceedings culminating in the order dated 28.02.2009 it would emerge that State did not have any knowledge of the proceedings before respondents 2 and 3 and as such the orders impugned in the writ petition would not be binding on it." 7. It is pertinent to note that the Co-ordinate Bench of this Court besides following the Division Bench judgment of this Court in J. Mahadevaiah's. case (supra) has also considered the judgment of this Court in W.P. No. 833/2007 disposed of on 17.9.2008 which has been followed by this Court in W.P. No. 47591/2011 disposed of on 4.6.2012 having regard to the definition of the term of 'employer' as defined in Section 2(f) of the Act. In the wake of these judgments, I am of the considered opinion that in identical circumstances, this Court has categorically held that that the State Government is a necessary party to the proceedings under Section 7(4) of the Act. Following the said judgments, this writ petition requires to be allowed. 8. Accordingly, the following order is passed: "(i) The writ petition is allowed. (ii) The order dated 24.4.2010 (Annexure-A) and the order dated 22.10.2011 (Annexure-B) are hereby set aside. (iii) The proceedings are remitted back to the 2nd respondent for consideration afresh after affording opportunity to both the parties and reserving liberty to the parties to lead evidence. The 2nd respondent, shall thereafter, pass the orders on merits in accordance with law. (iv) It is also made clear that the 1st petitioner is deemed to have been arrayed as party before the 2nd respondent in the claim petition filed by the 1st respondent. The 2nd respondent shall dispose of the claim as expeditiously as possible but not later than three months from the date of receipt of a copy of this order. (v) All contentions of both parties are left open. (vi) It is also directed that the parties shall appear before the 2nd respondent controlling authority on 7.12.2015 without further notice. (vii) The amount in deposit made by the 1st petitioner shall be withdrawn by the 1st respondent, subject to the result of the claim petition."