The Management of Spencer and Co. Ltd., Madras vs The Appellate Authority under the Payment of Gratuity Act, Regional Commissioner of Labour Central, Madras, The Controlling Authority under the Payment of Gratuity Act, Madras (The Assistant Commissioner of Labour), Madras and S. Jayaraman

V.S. Sirpurkar, J.—This writ appeal is directed against the judgment of the learned single Judge whereby the learned single Judge dismissed

the writ petition filed by the petitioner against the orders of the appellate authority under the Payment of Gratuity Act whereby the said appellate

authority had confirmed the orders of the controlling authority wherein the workman was granted the gratuity, calculating the maximum gratuity

period of twenty months at the rate of 30 days per month, i.e. for 600 days.

It is an admitted case that the last drawn monthly salary of the 3rd respondent-employee was Rs.1,345/-. On that basis, the total gratuity

granted by the Controlling Authority was Rs.31,038.46. However, according to the employer, the total gratuity payable was only Rs.26,900/-,

which was paid to the employee. The employee, feeling dissatisfied by this payment, approached the Controlling Authority, who awarded the

enhanced gratuity at Rs.31,038.46.

Aggrieved by the orders passed by the Controlling Authority, employer preferred an appeal before the appellate authority under the Act. The

appellate authority, however, rejected the appeal. The employer challenged the order passed by the appellate authority by filing writ petition before

this Court which was dismissed by the learned single Judge, necessitating the present writ appeal by the employer.

Learned counsel for the appellant suggests that all the authorities below were in error in making the calculation as, according to him, the

maximum gratuity payable was limited by Sec.4(3) of the Act as it stood then, and, therefore, applying that section, the maximum gratuity payable

was for twenty months. Even if as per Sec.4(2) of the Act more amount became payable, applying the formula given under Sec.4(2), he pointed

out that, the salary being Rs.1,345/- per month, the maximum gratuity payable was twenty months'' salary and the total amount of gratuity would

come to Rs.26,900/-. Therefore, even on the basis of the long service rendered by the employee, the gratuity amount cannot be more than the

twenty months'' salary and it will be only that amount which will be payable and that cannot exceed Rs.26,900/-.

Learned counsel appearing on behalf of the employee-respondent, however, pointed out that the question was no more res integra and the

amount of gratuity had to be calculated as per the law laid down by the Supreme Court in Jeewanlal Ltd. etc. v. Appellate Authority, Payment of

Gratuity Act and others (1984) II LLJ SC 464.

Learned counsel pointed out that the Apex Court had in Jeewanlal case, cited supra, had confirmed the Division Bench judgment of this Court in

Jeevanlal (1929) Limited and Others Vs. Controlling Authority Under the Payment of Gratuity Act and Others, . Learned counsel points out from

the facts therein, more particularly stated in paragraph 12, that in that case the employees had put in 35 years of service and payment of gratuity

made to the employee worked out only to 520 days'' wages and not 20 months'' wages or 600 days'' wages which the employees were bound to

get in terms of Sec.4(3) of the Act. In that case, the demand of the employees was that the rate of wages per day must be arrived at by dividing

the monthly wages by the number of working days, viz. 26 days and on the basis of the figure so arrived the monthly wages must be calculated by

multiplying the figure by 30 and the sum arrived must again by multiplied by 20 to conform to the requirement of Sec.4(3) of the Act. The

employees claim that under Sec.4(3), as it stood then, even if it was said that the amount of gratuity payable to the employee shall not exceed 20

months'' wages, the 20 months'' wages were bound to be arrived at by the aforementioned calculation. Learned counsel points out from the

contents of paragraph 12 of the Division Bench judgment of this Court that the employee''s contention was accepted therein by the appellate

authority, which was ultimately upheld by the Division Bench.

Learned counsel further pointed out that the Apex Court accepted this calculation more particularly in paragraph 13 of its judgment in Jeewanlal

Ltd. case, cited supra. Learned counsel points out that in that paragraph, the Supreme Court has, for the purposes of Sec.4(3) of the Act, as it

stood then, first applied the formula of arriving at a day''s wage by dividing the monthly salary by 26 and not by 30 and then directed the quotient

to be multiplied by 600 and not by 520, as was suggested by the learned counsel for the employer.

It is, therefore, clear that the Supreme Court has approved the calculation made by the Division Bench of this Court, which we have pointed out

above. In our opinion, the judgment of the Supreme Court in Jeewanlal case, cited supra, clinches the issue. If that is so, there would be no

question of looking hither and thither and the calculations made by the controlling authority here as also approved by the learned single Judge

would have to be accepted.

In that view, we do not find any merit in the appeal and the appeal is directed to be dismissed but without any orders as to the costs.