Janak Harshvadan Dalal vs Union Bank of India and Others

Paresh Upadhyay, J.�Rule Mr. Varun Patel, learned advocate waives service of notice of rule on behalf of the contesting respondent Nos. 1 to 3 (the Authorities of the Union Bank of India).

Heard Learned advocates.

The issue involved in this matter is non-payment of gratuity to the petitioner. Since the issue pertained to non-payment of retirement/terminal dues, during the course of hearing, it has transpired that, though non-payment of provident fund is not the subject-matter of this petition, as a matter of fact, the amount of provident fund is also unpaid to the petitioner. Learned advocate for the respondent-Bank has informed the Court that, an amount of Rs. 6,92,674.80 is payable to the petitioner towards the provident fund, however certain formalities are to be completed and therefore, the said amount is not paid to the petitioner. It is further submitted that, an amount of Rs. 2,68,579/- was payable to the petitioner towards gratuity, but the said amount is forfeited by the Bank, which is the subject-matter of this petition. Thus, the total amount payable to the petitioner under these two heads comes to Rs. 9,61,253.80, according to the Bank. On oral direction of this Court today, the respondent - Bank has presented the cheque of Rs. 9,61,253.80 drawn in favour of the Registrar of this Court, and the said cheque is accepted by the Registry of this Court today.

On hearing the learned advocates for the parties, the facts as emerging from record, are as under:

The petitioner was an Officer of the Union Bank of India. He was charged with certain irregularities, for which, after departmental inquiry, punishment of compulsory retirement from the service was imposed on him vide order dated 15.6.2002. The said punishment order dated 15.6.2002 is not the subject-matter of this petition.

The petitioner, even after the said penalty of compulsory retirement, was entitled to the provident fund and gratuity. As per the say of the Bank, towards provident fund an amount of Rs. 6,92,674.80 is payable however certain procedural formalities are yet to be completed. It is further stated that, as per the Bank, an amount of Rs. 2,62,579/- was payable towards gratuity, but the same is forfeited vide order dated 18.2.2014, after issuing notice on 2.11.2013.

Mr. Joshi, learned advocate for the petitioner has contended that, the petitioner had moved the Controlling Authority under the Payment of Gratuity Act, but the said application was not entertained on the ground of delay, as well as want of territorial jurisdiction, of Gujarat Authorities. This was challenged before the Appellate Authority, and the Appellate Authority also confirmed it. This led to filing of Special Civil Application No. 9406 of 2013, on which the order was passed by this Court, remanding the matter back to the Authorities below, to decide the issue afresh, including on merits. The Appellate Authority has again passed an order holding that, for want of territorial jurisdiction, the claim of the petitioner cannot be entertained. In the meantime, the respondent-Bank issued a notice to the petitioner dated as to why the amount of gratuity be not forfeited, which followed by the order of forfeiture of gratuity dated 18.2.2014. It is this order dated 18.2.2014, along with the order of the Authorities below, which is under challenge before this Court in this petition.

Mr. Joshi, learned advocate for the petitioner has submitted that, the respondent-Bank is mite in a position to dispute the entitlement of the petitioner, either of provident fund, or gratuity, and therefore instead of contesting the issue on merits, the claim of the petitioner is contested on the ground of territorial jurisdiction, delay etc., by the Bank and the Authorities of the Bank are sending the petitioner from pillar to post. It is submitted that, if the contents of the notice of forfeiture of gratuity and the chronology of events of Special Civil Application No. 9406 of 2013 are looked at, conjointly, the attempt on the part of the respondent-Bank to issue notice and then to pass order of forfeiture of gratuity was indicative of lack of bona-fide on their part. It is submitted that, neither on merits, nor on the ground of delay, this could be done by the Bank. It is submitted that, the same was even an attempt to overreach the proceedings before this Court in Special Civil Application No. 9406 of 2013. It is submitted that, the said order be quashed and set aside. It is further submitted that, so far the claim of provident fund amount is concerned, the only objection is with regard to certain procedural formalities, which the petitioner is ready and willing to do. It is submitted that, this petition be allowed by granting appropriate relief in favour of the petitioner.

On the other hand, Mr. Patel, learned advocate for the contesting respondent-Bank has vehemently contested this petition, and it is submitted that, so far the order of forfeiture of gratuity is concerned, the Bank was well within its right, since the petitioner was already compulsory retired by way of punishment, and as the necessary consequence, this order is passed, and this Court may not interfere. So far the payment of provident fund amount is concerned, it is contended that, it is not the subject-matter of this petition and therefore, no relief be granted by this Court. It is submitted that, this petition be dismissed.

Having heard learned advocates for the respective parties and having gone through the material on record, this Court finds as under:

The petitioner was compulsory retired from the service of the Bank with effect from 15.6.2002. The said punishment is not the subject-matter of this petition. Even if the said punishment stand as it is, which it does, it is not in dispute that the petitioner is entitled to receive an amount of Rs. 6,92.674.80 towards provident fund, and Rs. 2,68,579/- towards gratuity. While recording so, it is observed that, in case of any discrepancy in calculation of these two amounts, there is agreement between the parties atleast to the extent that, it shall be sorted out by the parties at their end, and if required, appropriate application shall be made before this Court.

Firstly to deal with the order of the respondent-Bank dated 18.2.2014, forfeiting the gratuity, it needs to be recorded that, the punishment imposed by the respondent-Bank on the petitioner Was of compulsory retirement. It was neither removal from service, nor dismissal from service. The Disciplinary Authority at the time of deciding the quantum punishment, was conscious that it was not the case where either the punishment of removal or dismissal was to be imposed. Thus, the decision was taken to impose punishment of compulsory retirement. It is not in dispute, as recorded in the notice dated 2.11.2013 that, even in case of compulsory retirement, the petitioner was entitled to gratuity of Rs. 2,68,579/-. Thus the imposition of punishment of compulsory retirement ipso facto, does not result in forfeiture of gratuity. The bank did not impose any further punishment of forfeiting gratuity. Even if it was to be done, for more than a decade, Bank did not do it. Thus, the Bank and the petitioner, both had already accepted the order of compulsory retirement, and further that, the petitioner was entitled to receive gratuity of Rs. 2,68,579/-. Having settled the said issue in this form for over a decade, it transpires that, since the petitioner moved the Authorities to claim the gratuity, the Bank started the procedure of forfeiture of gratuity. It is a matter of record that Special Civil Application No. 9406 of 2013 was pertaining to the proceeding before the Controlling Authority under the Payment of Gratuity Act, on which notice was issued by this Court on 25.6.2013. Thus, even when the proceeding were pending before the Controlling Authority under the Payment of Gratuity Act, not only there was no order of forfeiture of gratuity, there was no notice either in that regard. Further, even when this Court initially issued notice and subsequently admitted the matter vide order dated 24.9.2013, there was no such notice of forfeiture of gratuity. Subsequently, on behalf of the respondent Bank time was sought on 24.10.2013, and even on that day there was no such adversity. In this chronology, it transpires that, the action of the respondent-Bank of issuing notice for forfeiture of the gratuity was less for forfeiture, more an attempt to overreach the proceedings before this Court. Be that as it may, even if that aspect is not gone into further, while examining the sustainability of the order of forfeiture of gratuity, this Court finds that, the petitioner was an officer, who ceased to be in service of the Bank since 15.6.2002, and he is issued notice on 2.11.2013, as to why his gratuity be not forfeited. It is the settled position of law that, an officer, who is not in employment, cannot be haunted for indefinite period. If tills was to be done, it ought to have been done within a reasonable period. The said period is even defined by the respondent-Bank itself, and reference can be made to Regulation 48 of the Pension Regulations. Therefore, it is held that, the action of the respondent-Bank of issuing notice to the petitioner on 2.11.2013 as to why his gratuity be not forfeited, and then ordering forfeiture of gratuity vide order dated 18.2.2014, were illegal on merits as well as limitation both. It was colourable exercise of power, as well. The said order dated 18.2.2014 is therefore required to be quashed and set aside.

As the consequence of above, the petitioner is held to be entitled to receive gratuity of Rs. 2,68,579/- as calculated by the Bank. In the facts and circumstances of this case, where even the petitioner is to be blamed to some extent for delay, no interest is ordered to be paid on this amount of gratuity.

The petitioner is, therefore, entitled to receive the said amount of Rs. 2,68,579/- from the Registry of this Court, from the total amount of Rs. 9,61,253.80 ps., deposited with the Registry of this Court, today.

Coming to the question of payment of provident fund, it is recorded that, as per Bank, an amount of Rs. 6,92,674.80 ps. is payable to the petitioner under this head. The only hurdle is some procedural formality. The Bank cannot be directed to make payment to the petitioners, without compliance of this procedural aspect. Learned advocate for the petitioner however has already stated that, all those formalities shall be completed by the petitioner within reasonable time. In this regard, learned advocate for the Bank has stated that, though the amount is deposited with the Registry of this Court, with a view to see that no procedural complications crop up, the Bank would make payment to the petitioner of provident fund amount with interest as per its calculation, and in the event of any dispute therein, the same can be settled by the petitioner and respondent separately. It is stated that, the amount deposited by the respondent Bank with the Registry of this Court in that regard, be permitted to be withdrawn subsequently. The say of the Bank is quite reasonable and the same is noted with acceptance. Considering this, in the operative part of this order, the Registry is directed to invest the amount in the respondent-Bank itself i.e. the Union Bank of India.

So far the procedural aspect regarding payment of provident fund is concerned, it is stated by the learned advocate for the petitioner that, the same shall be completed within a period of one month from today.

Mr. Patel, learned advocate for the respondent - Bank, on instructions states that, on completion of those formalities, and the same being in order, the amount of provident fund shall be immediately paid to the petitioner.

Considering the totality and for the reasons recorded above, the following order is passed.

This petition is allowed.

The impugned order passed by the respondent-Bank dated 18.2.2014, ordering forfeiture of gratuity of the petitioner, is quashed and set aside.

Registry is directed to make payment of Rs. 2,68,579/- by Account Payee (Cheque drawn in favour of the petitioner, and the said cheque shall be handed over to the learned advocate for the petitioner, against due receipt. This will take care of claim of the petitioner towards gratuity.

After paying the above stated amount of Rs. 2,68,579/- to the petitioner towards gratuity, from the total amount of Rs. 9,61,253.80 deposited with the Registry today, the balance amount of Rs. 6,92,674.80 shall be invested by the Registry of this Court, in the Fixed Deposit with the Union Bank of India (the respondent-Bank itself), initially for a period of three months.

The amount of Provident Fund shall be paid by the respondent-Bank to the petitioner, on completion of procedural formalities, within a period of two months from today.

On payment of the above stated amount of provident fund to the petitioner by the respondent-Bank, it would be open to the respondent-Bank to move this Court for withdrawal of the above stated amount of Rs. 6,92,674.80 ps., with interest accrued thereon.

Rule is made absolute to the above extent. No order as to costs.