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Raghbir Singh Mathur Vs. Rajasthan Financial Corporation - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtRajasthan High Court
Decided On
Judge
Reported in(1969)ILLJ403Raj
AppellantRaghbir Singh Mathur
RespondentRajasthan Financial Corporation
Cases ReferredPunjab v. Shibu Metal Works
Excerpt:
.....the operation of the staff regulation of 1958 itself and, therefore, i am clearly of the opinion that superannuation as such is not covered by any of the three sub-clauses of 01. (2) of regn, 5 of the gratuity..........the corporation is governed by a contract expressly stipulating his service to be for a specified period. regulation 5 provides as to when gratuity will not be admissible and it is as follows:5. (1) when not admissible.--no gratuity will be granted to, or in the case of, an employee-- (a) if he has not completed service in the corporation for a minimum period of ten years, or(b) if he is or has been discharged from service in the corporation for any misconduct(2) notwithstanding anything contained in clause (a) of sub-regulation (1) gratuity will be granted to, or in the case of an employee who has not completed service in the corporation for a minimum period of ten years, if-(i) he dies while in service of the corporation or;(ii) he has retired or has been required to retire, either on.....
Judgment:

Kan Singh, J.

1. This is a second appeal by an unsuccessful plaintiff and raises a short question about the interpretation ofRegulation 5 of the Rajasthan Financial Corporation (Payment of Gratuity to Employees) Regulations hereinafter to be referred as the Gratuity Regulations. The relevant facts which are not in dispute may be outlined as follows.

2. Plaintiff Raghbir Sahai joined the service of the Rajasthan Financial Corporation, hereinafter to be referred as the ' Corporation ' on 5 May 1955, when he was 52 years of age. On 1 April 1956, he was confirmed on his post with retrospective effect from the date of his original appointment. He attained the age of 55 years on 23 August 1958. He was normally to be retired at that age, but thereafter his further retention in service was ordered by the Corporation. This further extension could be for a fixed period of one year at a time and the services were not to be extended beyond the age of 60 years. After 23 August 1958 the plaintiff got four extensions, but at the time of granting the extension on 25 August 1961 it was mentioned that that would be the last extension- Accordingly, on the expiry of the period of last extension, the plaintiff ceased to be the employee of the Corporation. The plaintiff claimed gratuity from the Corporation in accordance with the Gratuity Regulations, but as the same was not paid to him, he commenced the action against the Corporation in the Court of the Civil Judge, Jaipur City. The learned. Civil Judge decreed: his claim to the extent of Rs. 2,925 only. Against this judgment the Corporation went in appeal to the District Judge, Jaipur City. The learned District Judge, on consideration of the relevant rules to which his attention was invited, came to the conclusion that the plaintiff was not entitled to claim any gratuity from the Corporation. Accordingly, he accepted the Corporation's appeal and reversed the judgment and decree of the Civil Judge. It is against this appellate judgment of the District Judge that the present second appeal has been lodged by the appellant.

3. The fate of the case depends on a consideration of the relevant rules and, therefore, I propose to read them in the first instance.

4. The Gratuity Regulations which laid down the conditions for grant of gratuity to the employees of Corporation were made in exercise of the powers conferred by Section 48 of the State Financial Corporation Act, 1951, under which the Corporation was established. Regulation 4 lays down the conditions for the grant of the gratuity and it is as follows:

4. Conditions of grant.-Subject to the terms, conditions and other provisions contained in the succeeding regulations, gratuity will be granted to a permanent employee after termination of his service in the Corporation, or in the event of his death before receipt of gratuity, to such person or persons as may be determined in accordance withRegulation 8 but nothing in these regulations shall be construed as conferring any right or benefit on any employee whose service in the Corporation is governed by a contract expressly stipulating his service to be for a specified period.

Regulation 5 provides as to when gratuity will not be admissible and it is as follows:

5. (1) When not admissible.--No gratuity will be granted to, or in the case of, an employee--

(a) if he has not completed service in the Corporation for a minimum period of ten years, or

(b) if he is or has been discharged from service in the Corporation for any misconduct

(2) Notwithstanding anything contained in Clause (a) of Sub-regulation (1) gratuity will be granted to, or in the case of an employee who has not completed service in the Corporation for a minimum period of ten years, if-

(i) he dies while in service of the Corporation or;

(ii) he has retired or has been required to retire, either on account of certified permanent incapacity due to bodily or mental infirmity or owing to the abolition of his appointment on account of reduction of establishment;

(iii) his service in the Corporation is terminated by the Corporation for reasons other than reduction of establishment or dismissal for misconduct.

5. The argument of Sri H.P. Gupta proceeds like this. He submits that Regulation4 states that subject to the terms and conditions and other provisions of the regulations gratuity will be granted to a permanent employee after the termination of the service in the Corporation or in the event of his death before receipt of gratuity to such person or persons according toRegulation 8. The only exception has been made in this Regulation 4 in respect of employees whose service in the Corporation is governed by a contract expressly stipulating his service to be for a fixed period only. Sri Gupta, therefore, submits thatRegulation 4 confers a right on the plaintiff to get the gratuity on termination of his service and this right, derived fromRegulation 4, has not been taken away by Regulation 5. He submits that Clause (1) ofRegulation 5 will govern only such employees as leave the service of the Corporation voluntarily without completing the period of ten years when they are in a position to serve the Corporation for the prescribed period of ten years. According to him, the plaintiff never voluntarily gave up the service of the Corporation and it was only the Corporation who terminated his service. Sri Gupta points out that Clause (2),Regulation 5, opens with a non obstante clause and, therefore, whatever has been said earlier in Clause (1) thereof is put aside and the moment it is shown that an employee fulfils the conditions laid down in Sub-clauses (ii) and (iii) of Clause (2) ofRegulation 5, the employee becomes entitled to get the gratuity from the Corporation, notwithstanding that he had not put in a total period of ten years' service. According to Sri Gupta, the services of the plaintiff can be said to have been terminated by the Corporation ' for reasons other than reduction of establishment or dismissal or misconduct.' According to him, every case of retirement will fall within the scope of what is conveyed by the term ' termination' and therefore, he argues that even though the plaintiff may have been retired, but according to him, this amounted to 'termination' by the Corporation and as it was ' for reasons other than reduction of establishment or dismissal or misconduct,' the plaintiff should be taken to be entitled to get the gratuity. Drawing support from the observations made by their lordships of the Supreme Court in Kanwar Singh v. Delhi Administration : [1965]1SCR7 and Regional Provident Fund Commissioner, Punjab v. Shibu Metal Works 1965--I L.L.J. 473 he argues that the regulations being a beneficent piece of legislation enacted for the benefit of the employees of the Corporation, the Court should interpret the regulation liberally so as to advance the underlying object of these regulations.

6. Sri Gupta is right in saying that the Court should look to the underlying purpose of the regulations and it is obviously to advance the legitimate interest of the employees. But this is not the whole position as is sought to be made out. Resort is to be had to the principles of interpreting a statute in the way suggested by Sri Gupta only when the language of the provisions that are to toe interpreted is not free from ambiguity. But where the language of a provision is quite clear, there is no room for bringing in these principles for interpretation. The judgments of their lordships to which reference has been made above, pertain to interpretation of provisions which had to be so interpreted on account of certain ambiguity having been found in them. The ultimate purpose of interpreting any statutory provision is to get its real intention and that has to be got at primarily by looking to the language that is employed in that particular provision. Now, to my mind,Regulation 5 does not appear to be ambiguous in any way. In Sub-clause (ii) of Clause (2) ofRegulation 5, words used are ' has retired or has been required to retire,' whereas in Sub-clause (iii) of 01. (2) ofRegulation 5 words used are ' service is terminated by the Corporation.' Now what is retirement and what is termination are well-known in the rules pertaining to conditions of service of employees. For seeing as to what is conveyed by these words one has to look to the conditions of service. Conditions of service may be laid down in an agreement where the employer and the employee had entered into an agreement or they may have been laid down by rules which are either statutory or non-statutory which have been made part of an agreement. As in the present case there are statutory rules, one has look to the rules for seeing as to what is really meant by the word ' termination ' or ' retirement.'

6. Now, Rajasthan Financial Corporation (Staff) Regulations, 1958, define the conditions of service of the employees of the Corporation and they have been made under Section 48 of the State Financial Corporation Act, 1951. Section 1 of these regulations deals with appointments. Section 2 provides for probation. Section 3 is headed ' Termination of service ' and Para. 16, which occurs under Section 3, runs as follows:

16. Termination of service by notice.-(1) During his probationary period an employee shall not leave or discontinue his service in the Corporation without giving prior notice in writing to the managing director of his intention to leave or discontinue the service. The period of such notice shall not be less than:

(a) seven days during the first month, and

(b) one month during the rest of the probationary period.

(2) After confirmation an employee shall not leave or discontinue his service in the Corporation without giving prior notice in writing to the managing director of his intention to leave or discontinue the service. The period of such notice shall not be less than:

(a) three months in the case of an employee in class A, and

(b) one month in the case of employee in any other class.

(3) An employee who contravenes the provisions of the foregoing Sub-regulations of this regulation shall be liable to pay to the Corporation as compensation a sum equal to his substantive pay for the period of notice required of him, provided that the board may at its discretion waive such payment of compensation in case of employee in class A and the managing director may at his discretion waive such payment of compensation in any other case.

(4) The Corporation may determine the service of an employee after expiry of the period of his probation on giving him:

(a) three months' notice, or substantive pay in lieu thereof, if he is an employee in class A, and

(b) one month's notice, or substantive pay in lieu thereof, if he is an employee in any other class.

The power to determine the service of an employee shall be exercised by the managing director, subject in the case of officers to the prior approval of the board.

(5) Nothing in this regulation shall affect the right of the Corporation:

(a) to retire or dismiss an employee without notice or pay in lieu thereof in accordance with the provisions of Regns, 17 and 37; and

(b) to determine the service of an employee without notice or pay in lieu thereof on his being certified by the Corporation's medical officer to be permanently incapacitated for further Continuous service in the Corporation

* * * *

Paragraph 17 of this regulation is about superannuation and retirement and is as follows:

17. Superannuation and retirement.- An employee shall retire at fifty-live years of age provided that the Board may at its discretion sanction from time to time the extension of his employment for a period not exceeding one year at a time, but no extension of his employment shall be granted beyond the age of sixty years.

Explanation.- Notwithstanding anything contained in this regulation, where an employee has at the credit of his leave account ordinarily leave earned and has in sufficient time before the date of retirement either:

(1) formally applied for leave and been refused it, or

(2) ascertained in writing from the managing director that leave if applied for would not be granted,

he may be permitted to avail of the leave so refused and in that case the employee would be deemed to have retired from service on the expiry of the leave.

7. Thus the term ' termination ' has to be taken to cover such cases of discharge of an employment as are not covered by Para. 17. In other words, where termination of the employee is brought about by virtue of Para. 17 of these regulations, it has to be referred as retirement. The Gratuity Regulations and the Rajasthan Financial Corporation (Staff) Regulations taken in conjunction will show as to what are really the conditions of service of a particular employee and, therefore, in my view, the term ' retirement' as used inRegulation 5 of the Gratuity Regulations has to be construed in the sense conveyed by Para. 17 of the Rajasthan Financial Corporation (Staff) Regulations, 1958. Regulation 4 of the Gratuity Regulations opens with these words:

subject to the terms, conditions and other provisions contained in the succeeding regulations gratuity will be granted to a permanent employee after termination of his service.

This means that there is not an unconditional right to get gratuity that has been conferred on the employees, but it has been expressly made subject to the other provisions of the regulations. Therefore, to claim any gratuity an employee has to show that his right to have it is based on the provisions other thanRegulation 4 of the Gratuity Regulations. There is only Regulation 5 which demies when gratuity is not admissible and when it is so admissible. The normal rule for grant of gratuity has been laid down in Clause (1) ofRegulation 5 and in order to be able to get gratuity an employee must have completed service in the Corporation for a minimum period of ten years. It is truecl. (2) opens with the non obstinate clause ' notwithstanding anything contained in Clause (a) ofSub-regulation (1) '; but this is in the nature of an exception and the ten years' rule is waived if the case of the employee is covered by any of the Sub-clauses (i), (ii) and (iii) thereof. However, it has to be borne in mind that the sub-clauses have to be interpreted as they are, and their ambit is not to be enlarged so as to erode the main rule about the minimum period of ten years for earning gratuity. The case of the plaintiff cannot, in my view, be covered by Sub-clauses (i) and (ii), because he has not retired or has been required to be retired either on account of permanent incapacity or owing to the abolition of his appointment on account of reduction of establishment. Sub-clause (iii) speaks of a termination by the Corporation, of course, for reasons other than reduction of establishment or dismissal for misconduct, but all the same it contemplates a positive action on the part of the Corporation for bringing about the cessation of the employment. It will not cover the case of an employee who superannuates at the age of 55 years and then retires. Such a retirement is brought about by the operation of the Staff Regulation, 1958, itself and does not need any specific order on the part of the Corporation.

It is true, the Corporation has been given the discretion to give extension to the employee even after superannuation for a period not exceeding one year at one time and not beyond 60 years of his age, tout this will not transform a case of retirement into one of termination of employment at the hands of the Corporation. All the same the retirement has been brought about as a result of the operation of the regulation itself. Therefore, in a case where an employee superannuates by operation of Para. 17 of the Rajasthan Financial Corporation (Staff) Regulations, 1958, it cannot be held that his services have been terminated by the Corporation within the meaning of Sub-clause (iii) of 01. (2) of Para. 5 of the Gratuity Regulations.

8. I may add a word about one more contention of Sri Gupta. He also sought to bring the appellant's case under Sub-clause (ii) of 01. (2) of Para. 5 of the Gratuity Regulations. He submitted that the petitioner has been required to retire by the Corporation. I am afraid this contention cannot hold good. In the first place, this sub-clause deals with physical incapacity, and secondly, superannuation as such is not brought about as a result of any positive act on the part of the Corporation, but it results from the operation of the Staff Regulation of 1958 itself and, therefore, I am clearly of the opinion that superannuation as such is not covered by any of the three sub-clauses of 01. (2) of Regn, 5 of the Gratuity Regulations.

9. In view of what I have discussed above, I find that the learned District Judge was right in holding that the plaintiff-appellant was not entitled to have gratuity from the Corporation as asked for by him.

10. In the result, I dismiss this appeal, but leave the parties to bear their own costs.

11. Sri Gupta prays for leave to appeal, under Section 18 of the Rajasthan High Court Ordinance which is granted.


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