TRAVANCORE COCHIN CHEMICALS LTD. v. CHANDRAN V. S/O VELAYUDHAN
2024-11-12
HARISANKAR V.MENON
body2024
DigiLaw.ai
JUDGMENT : HARISANKAR V. MENON, J. 1. These three writ petitions have been filed by the employer questioning the findings rendered by the authority under the Payment of Gratuity Act, 1972 (for short the “Act”) as confirmed by the appellate authority under the statute. 2. The short facts as culled out from W.P. (C) No. 32886 of 2018 are as under: The petitioner is a Public Sector undertaking under the Government of Kerala. The 1st respondent was employed as a supplier in a canteen run by the petitioner with reference to the provisions of Section 46 of the Factories Act. The 1st respondent was absorbed in the regular service of the petitioner company pursuant to a memorandum of settlement arrived at between the petitioner company (employer) and the workmen. A perusal of Ext.P2 would show that the canteen was established in 1959 and was being managed by a committee consisting of two representatives of the company and the canteen workers union. Pursuant to the settlement arrived at, the canteen workers were taken in the rolls of the petitioner company as seen from clause 1 of Ext.P2. Clauses 5 and 6 of Ext.P2 to the extent applicable herein read as under: “5. For the purpose of Gratuity, their services in the Canteen as specified in the Annexure ‘C’ will be reckoned. 6. The existing Agreement with the Unions expired on 26.7.1990. The policy decision to departmentalise the Canteen was taken on 20.4.1991. Accordingly, it was decided to absorb them in Company’s rolls from 1.4.1991. For their services from 27.7.1990 to 31.3.1991, the Unions demanded a lumpsum payment as ex-gratia and it was decided to give to those Canteen workers who were confirmed on or before 31.7.1990 a lumpsum amount equal to 15% of their respective salary as on 1.8.1990 (i.e. Basic Pay Plus D.A.) per month for 10 months (that is to say, equivalent to one and a half months’ salary as on 1.8.1990).” It is on the basis of Ext.P2, that the 1st respondent herein stood absorbed in the service of the petitioner company. However, a perusal of Annexure C forming part of Ext.P2 shows that the date of joining as regards the 1st respondent is reckoned as 24.10.1989. 3. On the basis of the above, the 1st respondent joined the service of the petitioner company and superannuated on 20.01.2013.
However, a perusal of Annexure C forming part of Ext.P2 shows that the date of joining as regards the 1st respondent is reckoned as 24.10.1989. 3. On the basis of the above, the 1st respondent joined the service of the petitioner company and superannuated on 20.01.2013. He was paid gratuity reckoning the service from 1989, and this is not disputed. 4. Later, the 1st respondent took up a stand that he was entitled for more gratuity than already paid. The matter was considered by the authority under the Act along with similar claims raised by the 1st respondents in the connected writ petitions. The 1st respondents took up a stand that their gratuity entitlement is to be reckoned not with reference to the dates noticed in Annexure C forming part of Ext.P2 and that the eligibility is to be reckoned with reference to 21.06.1979 on which date the 1st respondent in W.P. (C) No. 32886 of 2018, joined the service of the petitioner. As regards the 1st respondent in W.P. (C) No. 32905 of 2018, he took up the stand that his eligibility also is to be reckoned from 23.06.1979, whereas in W.P. (C) No. 32888 of 2018, the 1st respondent sought the benefits from 20.6.1979, the date on which, he joined service. 5. The authority under the statute, by Ext.P5 proceedings found that the stand of the petitioner company that the date as shown in Annexure C forming part of Ext.P2 having been accepted by the Union is the final date which is to be acted upon, does not merit consideration. The authority found that there was no signature of any of the parties mentioned in Annexure C in Ext.P2 and therefore, the normal presumption was that the parties have not accepted the date adopted by the Management. The authority also found that the documents produced from the side of the 1st respondent established that the respective dates of entry in service have also been admitted by the witness on behalf of the Management. Ultimately, the authority by Ext.P5 order directed the payment of more amounts to the 1st respondents in these writ petitions. 6. Though the petitioner filed separate appeals, the appellate authority by Ext.P7 order rejected the appeals confirming the findings of the original authority. 7.
Ultimately, the authority by Ext.P5 order directed the payment of more amounts to the 1st respondents in these writ petitions. 6. Though the petitioner filed separate appeals, the appellate authority by Ext.P7 order rejected the appeals confirming the findings of the original authority. 7. It is in the afore circumstances that the captioned writ petitions are filed challenging the orders at Exts.P5 and P7 issued by respondents 2 and 3, respectively, in these writ petitions. 8. I have heard Sri.Jai Mohan, the learned counsel for the petitioners and Sri.Ajith Prakash, the learned counsel for the 1st respondents in these writ petitions. 9. Sri. Jai Mohan, the learned counsel for the petitioner would contend that: (i) The finding of the authority under the Act in Ext.P5 order that the settlement was not admitted by the workmen is not correct. The finding that the settlement and the terms thereunder are not reliable is also disputed by him. He would rely on the judgment of the Apex Court in National Engineering Industries Ltd. v. State of Rajasthan, (2000) 1 SCC 371 in support of the afore contention. (ii) He would point out that the 1st respondents were sleeping over the terms and conditions contained in Ext.P2 for 25 years and had decided not to question the same. (iii) He would also contend that Ext.P2 does not prescribe anything as regards the eligibility under the Act and only the date of joining the service of the petitioner company is fixed thereunder. (iv) He urges that, right from the beginning, the Management contended that the 1st respondents in these writ petitions were engaged by different contractors, and they were included in the rolls of the petitioner only pursuant to Ext.P2. Therefore, with reference to Ext.P2 and the dates noted in Annexure C thereunder alone, the eligibility for gratuity is to be considered. 10. Per contra, Sri. Ajith Prakash, the learned counsel for the 1st petitioners in these writ petitions, would contend that: (i) The fact that the 1st respondents in these writ petitions were working in the petitioner company from 1979 onwards is not under dispute in view of the admission by the witness from the side of the Management as recorded in Ext.P5 order.
Ajith Prakash, the learned counsel for the 1st petitioners in these writ petitions, would contend that: (i) The fact that the 1st respondents in these writ petitions were working in the petitioner company from 1979 onwards is not under dispute in view of the admission by the witness from the side of the Management as recorded in Ext.P5 order. (ii) He would rely on the provisions of Section 2(e) of the Act and contend that any person who was employed by the employer is reckoned thereunder, and the only exclusion is that of an “apprentice.” Therefore, according to him, since the 1st respondents were working in the statutory canteens, even if on a temporary basis, are to be provided the benefits under the statute as claimed by them. (iii) He refers to Sections 4(2) and 14 of the Act to contend that even on the face of the settlement at Ext.P2, the eligibility under the statute is to be reckoned dehors the various clauses contained in Ext.P2. (iv) He relies on Bakshish Singh v. M/s. Darshan Engineering Works and Others, (1994) 1 SCC 9 , in support of his contentions. 11. I have considered the rival submissions as well as the connected records. 12. The following question arises for consideration in these writ petitions: (i) Is the eligibility for gratuity under the Act to be reckoned with reference to the provisions thereunder or with reference to the terms of Ext.P2 memorandum of settlement? 13. As regards the question framed as above, it is to be noticed primarily that the Act is a welfare legislation. Section 4 of the statute provides for payment of gratuity, as under: “4. Payment of gratuity: (1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years: (a) on his superannuation. (b) on his retirement or resignation.
Section 4 of the statute provides for payment of gratuity, as under: “4. Payment of gratuity: (1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years: (a) on his superannuation. (b) on his retirement or resignation. (c) on his death or disablement due to accident or disease: Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement: Provided further that in the case of death of the employee, gratuity payable to him shall be paid to his nominee or, if no nomination has been made, to his heirs, and where any such nominees or heirs is a minor, the share of such minor, shall be deposited with the controlling authority who shall invest the same for the benefit of such minor in such bank or other financial institution, as may be prescribed, until such minor attains majority. Explanation: For the purposes of this section, disablement means such disablement as incapacitates an employee for the work which he, was capable of performing before the accident or disease resulting in such disablement. (2) For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days wages based on the rate of wages last drawn by the employee concerned.” Thus, gratuity is payable upon termination of an employee on account of superannuation/resignation/disablement. The gratuity is to be paid with reference to the “completed year of service” or “part thereof.” The 1st respondents claim that they were inducted in the service of the petitioner company on a temporary basis from 1979 onwards. A perusal of Ext.P5 shows that the 1st respondents’ names figured in the list relied on by them – the overall seniority list - from different dates in the year 1979. As regards the 1st respondent in W.P. (C) No. 32905 of 2018, there is a further finding to the effect that his name was seen enrolled in the Provident Fund from 01.04.1983 as evidenced by various documents relied on by the said respondents. The date of enrollment as above is admitted also by the witness from the side of the petitioner company.
The date of enrollment as above is admitted also by the witness from the side of the petitioner company. In the 7th page of Ext.P5, it is categorically found as under by the authority under the Act: “The documents produced by the petitioners to establish their respective date of entry into service has also been admitted by the witness of the management. Hence all the documents filed by the petitioners and marked during evidence are admitted by the management witness.” Thus, it cannot be disputed that the 1st respondents were working with the petitioner from 1979 onwards. Here, the contention of Sri. Jai Mohan that the 1st respondents were employed only by the contractors engaged by the petitioner is also to be noticed. Though such a contention is raised by him, a perusal of Ext.P5 would show that in the list of employees relied on by the 1st respondents in these cases, their names were figuring from 1979 onwards. Therefore, the eligibility of the 1st respondents in these cases for gratuity under the statute is only to be reckoned with reference to the provisions of the Act. 14. The contention raised by Sri. Jai Mohan that Ext.P2 has to be acted upon insofar as the employees were also parties to the memorandum of settlement is now to be considered. It is true that by virtue of Ext.P2, the 1st respondents were absorbed in the service of the petitioner. But as noticed earlier, the dates shown in Annexure C forming part of Ext.P2 cannot be conclusive for the purpose of the Act. In this connection, the provisions of Section 14 of the Act are to be noticed and the same reads as under: “14. Act to override other enactments, etc. - The provisions of this Act or any rule made there under shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act.” A reading of the afore provision would show that the provisions under the Act would have an overriding effect over any “instrument or contract” having effect by virtue of any enactment other than the Act. Here, the petitioner company relies on Ext.P2.
Here, the petitioner company relies on Ext.P2. However, by virtue of the overriding effect under Section 14, there cannot be any reference to the dates under Annexure C of Ext.P2 for reckoning the eligibility under the Act. Here, the judgment of the Madras High Court in Indian Overseas Bank v. Regional Labour Commissioner, 2009 (IV) LLJ 874 (Mad) is to be referred to. That was a case where the workman joined the service of the bank on 30.12.1957 and retired on 31.05.1994. Pursuant to a settlement between the Management and the workers, a revision of salary was carried out with retrospective effect from 01.07.1993. However, as per the settlement, in respect of payment of gratuity, the benefit of the revised salary could be taken only in respect of employees who retired on or after 01.01.1994. The sanctity of the said date of 01.01.1994 as per the settlement was considered by the High Court, finding as under: “21. In these circumstances, the contention of the learned counsel for the appellant that in the Settlement entered into in respect of revision of salary, a subsequent cut-off date viz., November 1, 1994 was fixed for the purpose of gratuity claim and hence, the third respondent is not entitled to claim more than what he was granted as gratuity cannot be countenanced especially when the third respondent was an employee within the meaning of Payment of Gratuity Act, 1972, even after its amendment dated April 25, 1994. Further, the agreement entered into cannot take away the rights of parties, particularly when a better benefit is given to the employees. In such view of the matter, it is not possible to accept the contention of the learned counsel for the appellant and we find no reason to interfere with the order of the learned Judge.” The afore judgment also refers to the provisions of Section 14 of the Act providing for an overriding effect as regards “instrument or contract” to the contrary. 15. The judgments referred to by Sri. Jai Mohan, the learned counsel for the petitioner, are now to be noticed. He relied on the judgment of the Apex Court in National Engineering Industries Ltd. v. State of Rajasthan, (2000) 1 SCC 371 , in support of his contention with respect to the sanctity of Ext.P2 settlement. Here, there is no dispute with reference to the sanctity of Ext.P2.
He relied on the judgment of the Apex Court in National Engineering Industries Ltd. v. State of Rajasthan, (2000) 1 SCC 371 , in support of his contention with respect to the sanctity of Ext.P2 settlement. Here, there is no dispute with reference to the sanctity of Ext.P2. It is only that the 1st respondents pointed out that the provisions of Ext.P2 settlement cannot override the provisions of the statute. He also referred to the judgment of the Apex Court in State of Uttaranchal v. Jagpal Singh Tyagi, (2005) 8 SCC 49 in support of his contention that, even if there is any dispute as regards the terms of the settlement, that can only give rise to another industrial dispute. However, in the case at hand, as noticed earlier, the settlement deed does not provide for payment of gratuity. It cannot override also. The gratuity has to be paid with reference to the provisions of the statute. What Ext.P2 says is that the service in the canteen is also to be reckoned for the purpose of gratuity. However, merely by virtue of the above clause, in my opinion, the settlement deed cannot be considered to be the Magna Carta for reckoning the length of service of the 1st respondents in the petitioner company. Sri. Jai Mohan thereafter referred to the judgment of the Apex Court in Bhupendra Kumar Chimanbhai Kachiya Patel v. Divisional Controller GSRTC Nadiad, JT 2018 (3) SC 130. This was a case where the binding nature of the settlement with reference to the provisions of Section 18 of the Industrial Disputes Act, came up for consideration before the Apex Court. Considering the afore, the Apex Court found as under: “28. It is not in dispute that the Corporation has followed the procedure provided in clause 20 while granting the employees their permanent cadre and the time scale of conductor. In other words, all eligible “Badali Kamdars” were absorbed in the set up and accordingly granted benefit in terms of the procedure prescribed in clause 20 of the Settlement. 29.
It is not in dispute that the Corporation has followed the procedure provided in clause 20 while granting the employees their permanent cadre and the time scale of conductor. In other words, all eligible “Badali Kamdars” were absorbed in the set up and accordingly granted benefit in terms of the procedure prescribed in clause 20 of the Settlement. 29. It is also clear from the undisputed facts that firstly, the appellant (employee concerned) was appointed as “Badali Kamdar” in the set up of Corporation on 04.06.1999; Secondly, clear vacancy arose in the permanent cadre of Conductor in and around 27.08.2008; Thirdly, as per the seniority list of the “Badali Kamdars” the appellant was accordingly absorbed in the permanent cadre at the time scale with effect from 27.08.2008 on completion of 180 days of his service in the cadre and, as a consequence thereof, was given all the benefits of the said post from the said date; and lastly, since then the appellant and all employees alike him are continuing on their respective post. 30. In our considered opinion, in the light of what we have held above, there is no basis for the appellants (employees) to claim the aforesaid benefit from the date of their initial appointment as “Badali Kamdar.” Indeed, there is neither any factual foundation nor any legal foundation to claim such benefit. 31. Learned counsel for the appellants was also not able to show any document, such as any term/condition in the appointment letter or in the settlement or any Rule/Regulation framed by the Corporation recognizing such right in appellants’ favour to enable them to claim such benefit from the date of their initial appointment. 32. Clause 20 of the Settlement is the only clause which recognizes the appellant’s right for consideration of his case on individual basis and to grant him the benefit subject to his fulfilling conditions specified therein which, the appellant’s case, were found satisfied and accordingly, he was granted the benefit along with each such employees. 33. It is pertinent to mention that the appellants neither challenged the settlement nor its applicability. In other words, the legality or/and binding nature of settlement dated 21.12.1989 was never questioned in these proceedings.
33. It is pertinent to mention that the appellants neither challenged the settlement nor its applicability. In other words, the legality or/and binding nature of settlement dated 21.12.1989 was never questioned in these proceedings. In this view of the matter, the settlement is binding on both parties in terms of Section 18 of the Act.” It is to be noticed that first of all the afore judgment is rendered with reference to the provisions of Section 18 of the Industrial Disputes Act. With reference to the afore provision, there cannot be any dispute regarding the binding nature of settlements in an industrial dispute. However, in the case at hand, Section 14 of the Act provides that the terms in the settlement may not override the provisions of the statute. Secondly, the Apex Court, in the afore judgment, noticed that no documents to prove the original appointments were produced by the employees therein. But, in the case at hand, the order at Ext.P5 specifically finds that the 1st respondents in these cases were in the rolls of the petitioner from 1979 onwards with reference to the evidence produced. The learned counsel cannot avail any support on the basis of any of the afore judgments relied on by him. 16. Therefore, I am of the opinion that the petitioner may not be entitled to any of the reliefs claimed in these writ petitions. 17. Resultantly, these writ petitions are dismissed.