Municipal Committee vs The Appellate Authority under the Payment of Gratuity Act, 1972 and Others

Ashok Bhan, J.—This judgment shall dispose of three Writ Petition Nos. 9803/91, 9808/9] and 10381/91 filed by Municipal Committee, Tohana against three different employees. The question of law involved is the same. These cases are being taken together and disposed of by a common judgment. Facts are taken from CWP No. 9803/91.

Bhagwan Dass respondent No. 3 (hereinafter referred to as respondent No. 3) retired as Octroi Maharrir, Municipal Committee, Tohana (hereinafter referred to as the Petitioner). Respondent No. 3 filed an application before the Controlling Authority (hereinafter referred to as the Controlling Authority) under the Payment of Gratuity Act 1972 for payment of gratuity under the Act. Respondent No. 3 had rendered approximately 39 years 9 months and 15 days of service and was drawing Rs. 1753/- per month as salary. The Controlling Authority issued a notice to the petitioner who filed the written statement denying its liability to pay the gratuity. On the pleadings of the parties, the following two issues were framed:-

Whether the applicant is entitled to the amount as claimed in the claim applicant?

Relief.

After filing the written statement, petitioner Municipal Committee did not put in appearance before the Controlling Authority and was ordered to be proceeded ex parte. Respondent No. 3 lead his evidence. After taking into consideration the pleadings of the parties and the evidence lead by respondent No. 3, the Controlling Authority ordered that gratuity be paid to respondent No. 3. Petitioner was also directed to pay 15% compound interest per annum on the amount due from the date of institution till its payment to respondent No. 3.

Petitioner being aggrieved against the order of the Controlling Authority filed an appeal before the Appellate Authority which was dismissed by it on the ground that the appeal was not maintainable because the petitioner did not deposit the amount equal to the amount of gratuity as payable u/s 4 of the Gratuity Act and in the absence of the same, the appeal could not be entertained. Appeal was dismissed being not maintainable.

Aggrieved against the order passed by the Authorities under the Payment of Gratuity Act, the petitioner has filed the present petition.

The main contention of the learned counsel for the petitioner is that the authorities under the Act have gravely erred in calculating the gratuity under the Payment of Gratuity Act because according to Section 2(e) of the Payment of Gratuity Act as amended in 1984, those employees in whose respect rules have been framed by the Centra] Government or the State Government providing for payment of gratuity are not entitled to payment of gratuity under the Payment of Gratuity Act. The State of Haryana had framed rules known as Haryana Municipal Employees (Integration, Recruitment and Conditions of Service) Rules 1982 which were adopted and enforced upon the Municipal Employees as applicable to the employees of Haryana State. Civil Service Rules provides for the payment of gratuity to the employees and, thus, the employees of the Municipal Committees including respondent No. 3 are covered under the Civil Services Rules Volume 11 as applicable to the employees of Haryana State. In view of this, it was argued that the employees of the Municipal Committee shall be governed regarding the Payment of gratuity under the rules framed by the State and not by the Payment of Gratuity Act with regard to payment of gratuity.

We find force in the submission of the Seamed counsel for the petitioner. Section 2(e) as amended by Payment of Gratuity Amendment Act 1984 provides, "but does not include any such person who holds a post under the Central Government or a State Government and is governed by any Act or by any other Rules providing for payment of gratuity." According to the petitioner, the State Government has framed Rules regarding payment of gratuity to the employees of the various Municipal Committees in the State of Haryana. Rules regarding payment of Gratuity to the employees of the municipal Committees were enforced w.e.f. February 15, 1982. Amendment in Section 2(e) of the Payment of Gratuity Act came into force in the year 1984. Respondent No. 3 retired in the year 1989. On the plain reading of the provision of the Act, it is clear that where there are specific rules which provide for payment of gratuity then an employee who retired from service would be entitled to gratuity as per the rules so framed by the State Government and not under the Payment of Gratuity Act. Respondent 3 shall be entitled to the payment of gratuity under the Haryana Municipal Employees (Integration, Recruitment and Conditions of Service) Rules 1982 and not under the Payment of Gratuity Act. It is true that this fact has not been noticed by the Authorities under the Act. This has happened primarily because the petitioner did not put in appearance before the Controlling Authority after filing its written statement. But, this is a mistake which is apparent on the face of it and has been in-advertantly committed by the Controlling Authority as the provisions of the Haryana Act provide for the payment of gratuity to the employees of the various municipal Committees were not brought to the notice of the Authority under the Payment of Gratuity Act and needs to be corrected. The order passed by the authorities under the Payment of Gratuity Act cannot be allowed to remain in force as the mistake is apparent on he face of the record as the order has been passed in ignorance of statutory provisions.

For the reasons stated above, this writ petition is allowed and the order passed by the Controlling Authority are set aside and the case remitted back to the controlling Authority for re-decision keeping in view the statutory provisions of the Act in the rules as pointed out in this order. No order as to costs.