Harendra Prasad Sinha Son of late Dhanesh Prasad Sinha v. Deputy Chief Labour Commissioner (Central), Ministry of Labour and Employment, Govt. of India
2019-02-18
ANANDA SEN
body2019
DigiLaw.ai
ORDER : The petitioner, in this writ petition, has prayed for quashing the part of the order dated 29.3.2017 passed by respondent No. 1 in P.G. Appeal No. (02)/2017-A-7 affirming the order dated 29.11.2016 passed by respondent No. 2 in P.G. Application No. 36(69)/2013, whereby and whereunder, the prayer for determination of the amount of gratuity under the Payment of Gratuity Act, 1972 and issuance of direction upon the respondent No. 3 for paying the amount of gratuity to the petitioner has been rejected. 2. The petitioner has claimed the payment of gratuity. The facts are admitted in this case. 3. The petitioner was appointed on 5.1.1976 in the Central Coalfields Limited (for short ‘CCL’). He superannuated on 30.4.2013, after attaining the age of 60 years from the post of Assistant Engineer (Civil). During his service tenure, a criminal case was instituted against him being R.C. Case No. 5(A)/1999(R) and he was charged for the offence under Sections 7/13(2)/13(1)(d) of the Prevention of Corruption Act. The criminal case culminated in conviction of the petitioner vide judgment dated 8.10.2013 passed by the learned Addl. Judicial Commissioner-XVII-cum-Special Court, CBI, Ranchi. The petitioner preferred a criminal appeal being Criminal Appeal (S.J.) No. 841 of 2013 before this Court, which is pending for final adjudication. The sentence of the petitioner has been suspended and he is on bail. The petitioner superannuated with effect from 30.4.2013. Admittedly there was no departmental proceeding pending against the petitioner as on the date of his superannuation. The petitioner made an application for payment of gratuity before the General Manager, CCL, which was not paid on the ground of pendency of criminal case. The petitioner, thereafter, applied before the Controlling Authority under the payment of Gratuity Act, 1972 cum-Assistant Labour Commissioner (Central), Hazaribagh for making payment of his gratuity, which was registered as Application No. 36/(69)/2013. 4. After hearing the parties, his application was dismissed on the ground that the petitioner is a convict in a case under the provision of Prevention of Corruption Act, thus, he is not entitled to get the amount of gratuity. Challenging the said order, the petitioner preferred an appeal before the Appellate Authority i.e. Deputy Chief Labour Commissioner (Central) Dhanbad, which was registered as P.G. Appeal No. (02)/2017-A.7.
Challenging the said order, the petitioner preferred an appeal before the Appellate Authority i.e. Deputy Chief Labour Commissioner (Central) Dhanbad, which was registered as P.G. Appeal No. (02)/2017-A.7. The Appellate Authority heard the appeal of the petitioner which affirmed the order passed by the Controlling Authority and held that if the appellant is acquitted by the High Court, he will be eligible to get gratuity along with 9% interest. Challenging the order of the Controlling Authority and the Appellate Authority under the Payment of Gratuity Act, this writ petition has been filed. 5. A counter affidavit has been filed by the CCL stating that the petitioner was convicted for committing the offence under Prevention of Corruption Act. It has also been mentioned that the conviction of the petitioner involves moral turpitude, thus he is not entitled to receive the amount of gratuity. 6. I have heard the counsel for the parties and perused the record. 7. The petitioner was an employee of M/s CCL and he superannuated with effect from 30.4.2013 on attaining the age of superannuation i.e. 60 years. Though a criminal case was initiated when he was in service, but no departmental proceeding was initiated against him. He was allowed to superannuate without initiation of any departmental proceeding. After his superannuation, he was convicted on 8.10.2013. The petitioner claimed gratuity as the same was not paid to him on the ground of conviction. The Controlling Authority under the Payment of Gratuity Act and the Appellate Authority turned down the claim of the petitioner holding that he is not entitled to get gratuity till the Criminal Appeal ends in acquittal. The petitioner relies upon the judgment of the Hon'ble Supreme court in the case of Jaswant Singh Gill Vs. M/s BCCL and Ors., reported in (2007) 1 SCC 663 . 8. The payment of gratuity is governed by Section 4 of the Payment of Gratuity Act, 1972. Section 4(1) provides for payment of gratuity to an employee on the termination of his employment after he has rendered continuous service for not less than 5 years-(a) on his superannuation, or (b) on his retirement or resignation, or (c) on his death or disablement due to accident or disease.
Section 4(1) provides for payment of gratuity to an employee on the termination of his employment after he has rendered continuous service for not less than 5 years-(a) on his superannuation, or (b) on his retirement or resignation, or (c) on his death or disablement due to accident or disease. Section 4(6) of the said Act provides for forfeiture of gratuity, which reads as under: “4(6) Notwithstanding anything contained in sub-Section (1) :- (a) The gratuity of an employee, whose services have been terminated for any act, willful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be forfeited to the extent of the damage or loss so caused; (b) The gratuity payable to an employee [may be wholly or partially forfeited]- i. if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or ii. if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment.” 9. From the aforementioned provision of law, it is quite clear that the payment of gratuity of an employee can be forfeited whose services have been terminated for any act of willful omission or negligence causing damage or loss to, or destruction of property belonging to the employer to the extent of the damage or the loss. 10. Further, it provides that the gratuity of an employee can be wholly or partly forfeited if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part or if he is terminated for any act, which constitutes an offence involving moral turpitude, provided such offence is committed by him in course of employment. Section 4(6) is the only provision under the Act, which provides for forfeiture of gratuity on the conditions prescribed therein. 11. From perusal of the said conditions, I find that there should be a termination of services of the employee on the ground mentioned therein and then only the amount of gratuity can be forfeited. Thus the termination from service is sine quo non for forfeituring the amount of gratuity.
11. From perusal of the said conditions, I find that there should be a termination of services of the employee on the ground mentioned therein and then only the amount of gratuity can be forfeited. Thus the termination from service is sine quo non for forfeituring the amount of gratuity. In this case, it is admitted by the parties that there was no disciplinary proceeding and the service of the petitioner was not terminated, rather, he was allowed to superannuate in normal course after attaining the age of superannuation. 12. While going through the order of the Appellate Authority under the payment of Gratuity Act, I find that he has relied upon the judgment passed by the Hon’ble Supreme Court in the case of Chairman-cum-Managing Director, Mahanadi Coalfields Ltd. Vs. Ravindranath Choubey, reported in (2013) 16 SCC 411 . The Hon’ble Supreme Court while delivering the judgment, has also considered the judgment of Jaswant Singh Gill Vs. M/s BCCL and Ors., reported in (2007) 1 SCC 663 as well as other judgments. The Hon’ble Supreme Court has referred the issue before the Hon’ble Larger Bench as there was a conflict. The issue which confronted with the Hon’ble Supreme Court is as to whether the gratuity can be withheld in view of Rule 34 of the CDA Rules when examine in juxtaposition with the provision of Gratuity Act. The said conflict has been mentioned in para 22 of the said judgment. While dealing with the aforesaid fact and Section 4(6) of the Gratuity Act, in the said paragraph, the Hon’ble Supreme Court has clearly held that for invoking Clause (a) or Clause (b) of Sub-Section (6) of Section 4 of the payment of Gratuity Act, necessary pre-condition is the termination of service on the basis of departmental inquiry or conviction in a criminal case. It further held that this provision would not get triggered if there is no termination of service. 13. Be it mentioned that in the case of Jaswant Singh Gill (supra) and also in the case of Ravindranath Choubey (supra), there was a disciplinary proceeding against both the employees, which is not in the instant case.
It further held that this provision would not get triggered if there is no termination of service. 13. Be it mentioned that in the case of Jaswant Singh Gill (supra) and also in the case of Ravindranath Choubey (supra), there was a disciplinary proceeding against both the employees, which is not in the instant case. Thus, the appellate authority under the Payment of Gratuity Act has misinterpreted the judgment of the Hon’ble Supreme Court in the case of Ravindranath Choubey (Supra) rather, paragraph 22 of the said Judgment would be applicable in the case and would fit on the facts also as admittedly, neither there was any departmental proceeding against the petitioner nor there was termination of services of the petitioner of the instant case. Without there being any termination, forfeiture clause of payment of Gratuity Act will have no application. Thus, I hold that the views taken by the Controlling Authority as well as the Appellate Authority are not correct and cannot be sustained. 14. Considering the judgment of the Hon’ble Supreme Court specially paragraph 22 of Ravindranath Choubey’s Case (supra), I find that since there was no termination of service of the petitioner, the petitioner is entitled to receive the amount of Gratuity and the same cannot be withheld in terms of Section 4(6) of the Payment of Gratuity Act. 15. Thus, the impugned orders dated 29.11.2016 passed by the Controlling Authority in P.G. Application No. 36(69)/2013 and the order of the Appellate Authority in P.G. Appeal No. (02)/2017-A-7 are quashed and set aside holding that the petitioner is entitled to receive the amount of gratuity. 16. Accordingly, the respondent authorities are directed to release the amount of gratuity to the petitioner within a period of six (06) weeks from the date of receipt/production of a copy of this order. 17. With the aforesaid observation and direction, this writ petition stands allowed.