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Eastern Coal Fields Ltd. Vs. Regional Labour Commissioner, (Central) and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKolkata High Court
Decided On
Judge
AppellantEastern Coal Fields Ltd.
RespondentRegional Labour Commissioner, (Central) and ors.
Cases Referred and Punjab Beverages (P.) Ltd. v. Suresh Chand
Excerpt:
- .....act. in this connection, the learned counsel draws the attention of the court to section 14 of the payment gratuity act and submits that the said section 14 has an overriding effect over any other existing contract. mr. chaudhuri also submits that the appellate authority did not make any finding that the petitioner had a right to receive payment of gratuity like other optees although the petitioner was not an optee. he further submits that the appellate authority upheld the decision of the controlling authority on the ground that the discrimination between optees and non-optees of the wage agreement dated 11th december, 1974 was undesirable, but the appellate authority had no authority to extend any benefit which did not expressly arise out of any contract. he also submits that the.....
Judgment:

Ganendra Narayan Ray, J.

1. This writ petition is heard as a contested petition and the learned Counsel for the respondent No, 2 has appeared and affidavit has also been filed on behalf of the said respondent No. 2. The writ petition is directed against order dated 21st November, 1980 passed by the Regional Labour Commissioner (Central) being the appellate authority under the Payment of Gratuity Act, 1972 upholding the decision dated 31st December, 1979 of the Assistant Labour Commissioner (Central) Calcutta-II being the Controlling Authority under the said Payment of Gratuity Act, 1972.

2. It appears that the respondent No. 2 Sunil Kumar Bose was an employee of the Bengal Coal Company Limited and Messrs. Andrew Yule and Company Limited was at one time the Managing Agent of Bengal Coal Company Limited. Before the Coal Mines (Nationalisation) Act, 1973, the conditions of service of the said Sunil Kumar Bose used to be governed by certain rules called Andrew Yule and Co. Ltd. Clerical Staff Terms and Conditions of service and Standard Office Procedure. After the said Nationalisation Act, the said Sunil Kumar Bose became an employee of Coal India Limited with effect from 1st May, 1973 on the same terms and conditions. It appears that new terms and conditions were offered by the Coal India Limited but the said employee did not accept the same and he chose to continue on his existing terms and conditions of service. It appears that the Coal India Limited allowed the petitioner to be governed by the old service conditions and the employee who had opted for new terms were covered by an agreement dated 5th April, 1974. It appears that in December, 1973, workmen of Andrew Yule and Co. Ltd. and certain other companies entered into a settlement in a conciliation proceeding with their employers and a memorandum was signed on the 21st December, 1973. In the said settlement, provision for gratuity was also made to the following effect:

Payment of gratuity will be made in terms of the provisions of the Payment of Gratuity Act, 1972 and the following additional benefits will be available to the employees :

(i) All employees covered by this agreement will be entitled to receive gratuity irrespective of the quantum of salary at the time of retirement or determination of employment, or at the time of coming into force of the above Act.

(ii) The entire period of an eligible employee's employment will be taken into consideration for computation of gratuity subject to a maximum of 40 years service.

(iii) The gratuity will be computed on the basis of the gross salary (basic salary plus dearness allowance) received by an employee at the time of retirement or determination of employment.

(iv) The total amount of gratuity payable to an employee shall not exceed Rs 24,000.

(v) Arrangement for creating a fund or funds for the gratuity shall be made by the employers in due course.

It appears that the workmen who were previously employees of the Bengal Coal Company Limited made a representation that the aforesaid settlement regarding pension and gratuity should also be given effect to them by the Coal India Limited and it appears that the Coal India Limited accepted the said demand of the employees. It, therefore, appears that so far as the respondent No. 2 Sunil Kumar Bose is concerned, the petitioner-company agreed to make payment of gratuity on the basis of settlement dated 21st December, 1973. It also appears that respondent No. 2 retired from service on 31st December, 1973 on superannuation. On the date of retirement the said respondent had been drawing a salary of Rs. 1,384.81 per month and since September 1972 the said respondent No. 2 was entitled to a salary in excess of Rs. 1000 per month. The petitioner-company on retirement paid pension and gratuity to the said respondent in accordance with the settlement dated 21st December, 1973. The gratuity paid to the second respondent was Rs. 24,000 which was in excess of the payment to be made under Gratuity Act, 1972. The said respondent No. 2 Sunil Kumar Bose, however, was not satisfied with the payment of gratuity at Rs. 24,000 by the petitioner company and he made an application on the 1st March, 1979 to the Controlling Authority under the said Gratuity Act claiming gratuity for Rs. 24,416.10 inter alia alleging that his monthly salary was Rs 1,395.25 and as such he was entitled to claim gratuity for the entire period of his service of 35 years between August, 1943 and 31st December, 1978 including the period after August, 1972 during which he received salary exceeding Rs. 1,000 per month. A copy of the said claim petition has been annexed to the writ petition being Annexure 'B'. The petitioner-company field a written objection to the said claim of respondent No, 2 and the said objection petition is Annexure 'C' to the writ petition. The Controlling Authority under the Payment of Wages Act allowed the said application of the respondent No. 2 by his order dated 31st December, 1979. It appears that the petitioner-company did not appear before the said Controlling Authority and the case was decided ex-parte. The petitioner-company, however, preferred an appeal before the Appellate Authority and contended inter alia that the said claim petition was not maintainable. It was also contended that the said claiment was not an employee within the meaning of Section 2(e) of the Payment of Gratuity Act, 1972 and as such he was not entitled to any payment of gratuity under the said Act. The petitioner company, however, paid a sum of Rs. 24,000 to the said employee in full and final settlement of his account in terms of the aforesaid settlement but not under the Gratuity Act. It was also contended that when the Gratuity Act came into force, the applicant's salary was more than Rs. 1000 and as such he was not an employee under the said Act. It was also contended by the petitioner-company that as per explanation to Section 2(3) of the Gratuity Act the applicant was entitled to gratuity for the period of his service during which the salary did not exceed Rs. 1,000 per month. The applicant's salary in July, 1972 was Rs. 994 and thereafter his salary exceeded Rs. 1000 and as such he was entitled to a gratuity upto July, 1972, i.e., for 30 years at the rate of Rs. 994. Accordingly, the applicant was entitled to Rs. 14,910 and the petitioner-company having paid Rs. 4,000 to the said applicant, the petitioner-company was entitled to recover the excess payment of Rs. 9,090. It was also contended by the petitioner-company that the said memorandum dated 11th December, 1974 was also not applicable to the respondent No. 2 but the same was applicable to those employee who were covered by the said agreement. The appellate Authority, however, dismissed the said appeal and affirmed the adjudication made by the controlling Authority and as aforesaid, against the said adjudication by the Controlling Authority and the Appellate Authority the instant writ petition has been moved.

3. It was contended by Mr. Chaudhuri, the learned Counsel appearing for the petitioner company, that for enforcement of contractual obligation for payment of gratuity the respondent No. 2 was not entitled to maintain any application under the said Gratuity Act. Accordingly, the Controlling Authority could not have any jurisdiction under the Gratuity Act to enforce payment of gratuity on the basis of the agreement. He submits that the Controlling Authority had only jurisdiction to entertain application and direct payment of gratuity under the provisions of the Gratuity Act. In this connection, the learned Counsel draws the attention of the Court to Section 14 of the Payment Gratuity Act and submits that the said Section 14 has an overriding effect over any other existing contract. Mr. Chaudhuri also submits that the Appellate Authority did not make any finding that the petitioner had a right to receive payment of gratuity like other optees although the petitioner was not an optee. He further submits that the Appellate Authority upheld the decision of the Controlling Authority on the ground that the discrimination between optees and non-optees of the Wage Agreement dated 11th December, 1974 was undesirable, but the Appellate Authority had no authority to extend any benefit which did not expressly arise out of any contract. He also submits that the Appellate Authority could not confer any new right and the Controlling and/or the Appellate Authority ought to have decided as to from which source the right to receive gratuity arose, namely, whether under the said Gratuity Act or under any agreement but the Controlling Authority and the Appellate Authority failed to appreciate the said basic fact. He also submits that in the instant case the applicant not being an 'employee' within the meaning under the Gratuity Act, he was not entitled to claim any gratuity by making an application under the Gratuity Act and the Controlling Authority; therefore ; could not assume any jurisdiction to decide the case of the petitioner in terms of any agreement which was not under the purview of the Act.

4. Mr. Sengupta the learned Counsel appearing for the respondent No. 2, however, submits that Section 4(5) of the Gratuity Act clearly provides that nothing in the Gratuity Act will affect the right of an employee to receive better terms of gratuity under any award or agreement or contract in writing. He submits that when gratuity is payable under the Gratuity Act and not under any other Act, the claim for gratuity must be made before the Controlling Authority constituted under the Gratuity Act and not before any other forum. He submits that right to get gratuity in the instant case really arise under the Act but by an agreement a higher quantum of gratuity was agreed upon between the parties and the Controlling Authority only determined such higher quantum and as such there had not been any lack of jurisdiction on the part of the Controlling Authority in determining the said quantum. [In this connection, Mr. Sengupta refers to a decision of the Supreme Court made in the case of State of Punjab v. Labour Court Jullunder 1981-I L.L.J. 354. It has been held that the Gratuity Act is a self-contained code and its provisions impliedly exclude recourse to any other statute for payment of gratuity. Mr. Sengupta, therefore, contends that the claim for gratuity should be made under the Gratuity Act and respondent No. 2 therefore rightly made the said application before the Controlling Authority. He submits that in a beneficial legislation, the intention of the Legislature cannot be to drive a man to different forums to get a part of the payment of gratuity under the Gratuity Act and part of gratuity under a contract from a different forum. He submits that the respondent No. 2 is entitled to get payment of gratuity in terms of the contract in view of Section 4(5) of the Gratuity Act. Mr. Sengupta also refers to a decision of this Court made in the case of Mcneil and Magor Ltd. v. Shri Jogendralal 1979 (1) Cal. H.C. Notes 408. It has been held in the said decision that the Gratuity Act being a piece of welfare legislation, the provisions of the Act should be liberally construed so as to extend the benefit to as many as possible. In that view of the matter, a person drawing a salary of more than Rs. 1000 per month when the Act came into operation is also entitled to receive payment of gratuity provided his pay did not exceed Rs. 1000 all the time. Mr. Sengupta also refers to a decision of the Gujarat High Court made in the case of Sarahhai Chemicals Ltd, v. A.A. Patil 1978-I L.L.J. 105 for the contention : that a person who satisfied the requirements of the inclusive clause for entitlement of gratuity as an 'employee' continues to be employee till he is covered by the exclusive clause without reference to and specific period of time. Mr. Sengupta also submits that the petitioner being an employee was entitled to gratuity both under the gratuity Act and also under the contractual conditions of service. Even assuming that the petitioner should have claimed such gratuity not before the authority under the Gratuity Act but before a different authority, the writ Court being an equitable Court should not interfere because there has not been any manifest injustice by the impugned adjudication. In support of the said contention, Mr. Sengupta refers to the decisions of the Supreme Court made in the case of P. Kasilingam v. P.S.G. College of Technology 1981-I L.L.J. 358 and Punjab Beverages (P.) Ltd. v. Suresh Chand 1978 II L.L.J. 1

5. In reply to the aforesaid contentions of Mr. Sengupta, Mr. Chowdhury submits that Section 4(5) has not been correctly construed by Mr. Sengupta. He submits that Section 4(5) does not authorise payment under the Act contrary to the provisions of the Gratuity Act. It only enables an employee to receive better payment outside the Act in a different forum. He submits that the authority constituted under the Gratuity Act is bound to act strictly in conformity with the provisions of the Act and it cannot direct payment beyond the provisions of the Act although in view of Section 4(5) an employee may be entitled to receive higher amount under a more favourable term or contract. He also submits that the decisions of the Supreme Court made in Kastlingam's case and Punjab Beverage Company's case cited by Mr. Sengupta are not applicable to the facts of the case because in the instant case the tribunals below have acted manifestly without jurisdiction in entertaining the claim of the employee beyond the provisions of the Act and as such not only there has been an injustice to the employer but there has been usurpation of jurisdiction not warranted by the Act.

6. Considering the facts and circumstances of the case and the submissions of the learned Counsels appearing for the parties, it appears to me that although the petitioner was not an 'optee' for the new service conditions, the petitioner-company agreed on principle to give the benefit of favourable term of gratuity payment to the other employees also and as such the petitioner was entitled to such higher gratuity. It also appears to me the Payment of Gratuity Act in a beneficial legislation intended to give benefits to the employees and the provisions of the Act should be construed liberally in a way so that the beneficial intention is not frustrated by any strict and narrow interpretation but the benefit under the Act reaches the maximum possible employees. In my view, the provisions of Section 4(5) of the act has authorised the Controlling Authority to grant a higher quantum than quantum of gratuity under the Act in view of favourable conditions of service, although in the absence of such favourable conditions, such higher quantum could not have been decided by the Con-rolling Authority. In my view, it will not' be proper contruction in keeping with the beneficial purpose of the legislation, that although under Section 4(5) of the Act an employee may be entitled to a higher payment of gratuity but for enforcing such favourable terms of service for higher gratuity, he should move a different forum and the authority under the Gratuity Act cannot entertain such claim of higher amount of gratuity. In the facts of the case, it does not appear that the Tribunals below have acted beyond the jurisdiction and/or have made adjudications not warranted in law. Hence no interference is called for in the constitutional writ jurisdiction and the writ petition is dismissed without any order as to costs.


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