T.U. Mehta, J.
1. The question which is involved in this petition is whether an employee, who is found to be receiving a salary more than Rs. 1,000 per month on the date on which the payment of Gratuity Act, 1972 came in to force, is entitled to the payment of gratuity under the said Act on the basis of 5 years' continuous service on a non-managerial post in the past on the salary of Rs. 1,000 per month. This question arises in the following set of facts.
2. The petitioner is a limited company and the respondent was in its employment as Sales Engineer. The respondent joined the service of the petitioner as an Assistant Sales Engineer on 20th June, 1962 on the salary of Rs. 450 per month. He was, thereafter, promoted as Sales Engineer on 1-5-1970, when his salary was more than Rs. 1,000 per month. The Gratuity Act, 1972 came into force on 16th September, 1972. On that date, the respondent was receiving the salary of Rs. 1,200 per month, i.e., more than Rs. 1,000 per month. Thereafter the respondent resigned on the 6th August, 1973 when his salary was Rs. 1,250 per month. On his resignation he claimed gratuity under the provision of the Act but since his claim was not entertained by the petitioner, he approached the Controlling Authority, Baroda under the provisions of the Act. The said authority found that though on the date of the application of the Act, the respondent was receiving the salary of Rs. 1,000 per month, the respondent was entitled to gratuity because he had already rendered in past the continuous service of more than 5 years on a salary which was less than Rs. 1,000 per month. The said authority accordingly awarded him gratuity on the basis of 8 years service from 20th June, 1962 to 30th April, 1970 during which period his salary was less than Rs. 1,000 per month. The total amount of gratuity thus awarded by the said Authority was Rs. 4,000.
3. Against this order, the petitioner preferred appeal before the Appellate Authority being Appeal No. 34/35. The said authority confirmed the view taken by the Controlling Authority and dismissed the appeal. Being aggrieved by that decision of the appellate Authority, the petitioner has approached this Court by this writ petition.
4. Shri Shah, who appeared on behalf of the petitioner, contended that the definition of the word 'employee' as given in clause (e) of S. 2 of the Act, uses the present tense with reference to the employment of an employee and, therefore, unless the case of the respondent-employee was failing within the ingredients of the said definition on the date on which the Act came into force, no gratuity would be admissible to the respondent. In other words, according to Shri Shah, the respondent must be found complying with all the requirements of the definition of the word 'employee' with reference to the date on which Act came in to force, i.e., on 16th September, 1972, because, the provisions of the Act are expected to operate prospectively and not retrospectively. Shri Shah pointed out that on 16th September, 1972 when the Act came in to force, the salary of the respondent was admittedly more than Rs. 1,000 per month and therefore, he is not entitled to any gratuity under the Act. This was the only contention raised by Shri Shah on behalf of the petitioner, and, therefore, we shall concentrate our attention only on to this contention.
5. Clause (e) of S. 2 of the Act gives the definition of the word 'employee' as under :
'(e) 'employee' means any person (other than an apprentice) employed on wages, not exceeding 1,000 rupees per mensem in any establishment, factory, mine, oilfied, plantation, port, railway, company or shop, to do any skilled, semiskilled or unskilled, manual, supervisory, technical or electrical work, whether the terms of such employment are express or implied, but does not include any such person who is employed in a managerial or administrative capacity, or who hold a civil post under the Central Government or a State Government or who is subject to the Air Force Act, 1950, the Army Act, 1970 of the Navy Act, 1957.
Explanation : In the case of an employee, who, having been employed for a period of not less than five years on wages not exceeding one thousand rupees per mensem, is employed at any time thereafter on wages exceeding one thousand rupees per mensem, gratuity, in respect of the period during which such employee was employed on wages not exceeding the one thousand rupees per mensem, shall be determined on the basis of the wages received by him during that period.'
The question is whether a person should comply with al the requirements of the definitions of the word 'employee' as given above at the time when the Act came in to force or whether in order to get the benefits of gratuity contemplated by the Act, it would be sufficient if the said person complied with all the requirements of the definition of the word 'employee' during the course of his service at any time in the past. A question, which was more or less, similar to the present one, has been considered and dealt with by this very Bench in (Sarabhai Chemicals Ltd. v. Ambaram Amitharam Pale, XVIII G.L.R. 455. Spl. C.A. No. 29/76 which is decided on 1st April, 1976. In that case, the facts were that on the date of his resignation, the concerned employee was drawing a salary which was more than Rs. 1,000. Therefore, on behalf of the employer it was urged that since cause of action to get gratuity arises under S. 4. of the Act on the date of the resignation, the question whether the employee concerned fulfils the requirements of the definition of the word 'employee' given in clause (e) of S. 2 of the Act. should be decided with reference to the date on which the said cause of action arose i.e., the date on which the employee put his resignation. This contention was negatived by this Court holding that the interpretation which was put on the definition of the word 'employee' by the petitioner in that case, was unacceptable acceptable as it sought to add some more words to the statutory definition of the word 'employee' by limiting its operation with reference to a particular date, even though the words and language of the definition clause were wide enough to cover the case of an employee, who held a non managerial post and had received wages of not more than Rs. 1,000 per month at any time in the past. Speaking about the definition of the word 'employee' this Court has observed in that case as under :
'The definition clause obviously speaks of 'a person employed on wages'. It does not use the word employee with reference to any specified period of time. In other words, the employment which is contemplated here, is employment simplification without being hedged by any condition as regards time.'
6. Shri Shah, who appeared on behalf of the petitioner, however, laid great stress on the present tense which is used in the definition of the word 'employee' given in clause (e) of S. 2. He drew out attention to the fact that the said definition uses the verb 'means' in the present tense also refers to an 'employee' as one who 'is employed' in the later action of the main definition clause. He, therefore, contended that the use of the present tense in this definition conclusively shows that the benefit under the Gratuity Act was intended to be confined only to that employee whose case fell within the said definition clause on the date on which the said Act came into force.
7. We find that even this aspect has been considered by us in the above refereed Spl. C.A. No. 29/76. In that case we have made reference to the decision given by the Supreme Court in Bennett Coleman and Co. Pvt. Ltd. v. Punya Priya Das Gupta, : (1969)IILLJ554SC . We have observed in that case as under with reference to this Supreme Court decision while considering the implications of the expression 'is employed' :
'Similar situation was considered by the Supreme Court in Bennett Coleman and Co. Pvt. Ltd. v. Punya Priya Das Gupta : (1969)IILLJ554SC . The Supreme Court in that case considered the provisions contained in clause (f) of S. 2 of Working Journalist (Conditions of Service) and Miscellaneous Provisions Act (1955). According to this clause, a 'working Journalist' means a 'person whose principle vocation is that of a journalist, and who is employed as such in, or in relations to any newspaper establishment. In view of the use of the words 'is employed', a contention which was raised before the Supreme Court was that since the respondents workman was not in continues employment at the time he filed his claim in the Labour Court, he was not working journalist, and his cases did not fall within the definition contained clause (f), and therefore, he was not entitled to avail himself the provisions of the above refereed Working Journalists Act. This contention was rejected by the Supreme Court holding that the expression 'who is employed' as in S. 2(f) of the Act, was not restricted to newspaper employee, who was presently employed in a newspaper establishment, but it all related to an ex-employee, whose employment had come to an end as result of acceptance of his resignation and, therefore, such an ex-employee could also resort to the provisions of the Act. While taking this view, the Supreme Court has made the following pertinent observations :
'The scheme of all Acts dealing with industrial questions is to permit an ex-employee to avail of the benefits of their provisions, the only requirement being that the claim in dispute must be one which has arisen or accrued whilst the claimant was in the employment of the person against whom it is made.' The portion emphasised from the above except taken from the said Supreme Court decision clearly brings out the ratio that if the claim has arisen or accused whilst the claimant was in employment, the use of the present tense would not be a determinant factor, and such a use of the present tense must be construed with reference to the scheme and the object of such beneficial legislation.'
8. Now, if construction of the definition of the word 'employee' is required to be made with reference to the scheme of the object of the Act, it cannot be gain aside that the object of the Act is to provide for a scheme for the payment of gratuity to certain categories of employees engaged in certain specified types of concerns. The gratuity is in its essence a payment in consideration of past services made only at the end of the said services when the employment terminates. Therefore, the very essence of gratuity is 'past' and not the 'present'. Under the circumstances, it is clear that by using the present tense in the definition of the word 'employee', the Legislature could not have intended to negative the gratuity claim of those employees who had rendered the requisite period of service in the past, and who were not otherwise disqualified from getting gratuity under the provisions of the Act.
9. This position becomes very evident by reference to the explanation, which is attached to definition of the word 'employee'. The said explanation says that in the case of an employee who has been employed for not period not less than 5 years on wages not exceeding Rs. 1,000 per month but who is exceeding Rs. 1,000 per month but who is employed at any time thereafter on wages exceeding Rs. 1,000 per month, his gratuity shall be determined on the basis of the wages received by him for the period during which he has served on the wages of less than Rs. 1,000 per month. This explanation clearly contemplates the cases of those employees, who have been employed in the past for a continues period of 5 years on a salary which is not more than Rs. 1,000 per month. Thus, the explanation makes it quite clear that the intention of the Legislature was to take in to consideration of the whole record of the past service of the employee and to give benefit of gratuity even to those employees who were receiving the salary of more than Rs. 1,000 per month on the date on which the Act came into force. This intention of the Legislature should, therefore, be carried out.
10. Shri Shah contended that our above interpretation would render the operation of the Act retrospective. We find that this contention has no merits. The reason is that in order to make himself eligible to the benefit of the gratuity under the provisions of the Act, the employee concerned must show that his case falls within the provisions of S. 4. of the Act. This S. 4. contemplates that the gratuity shall be payable to an employee on termination of his employment either by his superannuation, or his retirement or his resignation or his death or disablement due to accident or disease. Thus S. 4 provides for the cause of action for an employee to get gratuity. This cause of action must arise after coming in to force of the Act and not before that. Therefore, in order to enable himself to get the advantage of the provisions of the Act, the employee should continue in the employment even after coming in to operation of the Act and should show that his cause of action to get gratuity under S. 4. of the Act has arisen after the Act came in to force. Thus the operation of the Act is undoubtedly prospective and not retrospective on the interpretation of the word 'employee' which is attached to the main definition clause.
11. As observed by us in the above referred Spl. C.A. No. 29/76, if a person wants to take advantage of the gratuity contemplates by the Act, he has to prove the following facts :
1. That at any time in the past during the course of his employment, he was receiving the wages not exceeding Rs. 1,000 per mensem;
2. That this period of service was contains for not less than 5 years;
3. That during this period, he was not employed in a managerial or administrative capacity.
If a person proves these three factors, then he would be entitled to the gratuity contemplated by the Act irrespective of the question whether on the date on which the Act came in to force, his case was falling within the ingredients of the definition given in the main clause of the word 'employee'. We find that if the contusions which is can passed on behalf of the petitioner by Shri Shah is accepted, then the whole purpose of the definition of word 'employee' would be frustrated. Under the circumstances we see no point in this connection.
12. This Special Civil Application should therefore fail and the rule is discharge with costs.
13. Shri Shah orally prays for a certificate for leave to appeal to the Supreme Court. We find that there is no substantial question of law of public importance which in our opinion should be decided by the Supreme Court. The said prayer is rejected.