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Divisional Controller Vs. Zala Raisingh Babbabhai - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtGujarat High Court
Decided On
Case NumberSPECIAL CIVIL APPLICATION No. 6237 of 2011
Judge
ActsPayment of Gratuity Act 1972 Section 4(5); Provision Act - Sections 7(3A), 14; Constitution of India - Article 227
AppellantDivisional Controller
RespondentZala Raisingh Babbabhai
Cases ReferredState of Kerala and Ors. v. M. Padmanabhan Nayyar
Excerpt:
[r.v. raveendran; a. k. patnaik] indian penal code section 452 - house-trespass after preparation for hurt, assault or wrongful restraint -- after investigation, the police filed two challans on 02.02.2006 before the judicial magistrate, first class, ludhiana. after further investigation, the superintendent of police, city-ii, ludhiana, submitted his report to the deputy inspector general of police, ludhiana range. the relevant portion of the report of the superintendent of police, city-ii, ludhiana, which contains his conclusions after further investigation, is extracted herein below: "i found during my investigation that mohan singh, son of shri sher singh , dharmatma singh, harpal singh, jagdev singh and bhupinder singh, sons of mohan singh, residents of pullanwal, sold one plot.....1. heard learned advocate mr. hardik c. rawal appearing on behalf of petitioner - divisional controller, gujarat state road transport corporation, divisional office, nadiad ('petitioner corporation' for short).2. in this group of petitions, petitioner has challenged order passed by controlling authority, nadiad in gratuity application filed by respondent workman and same has been decided in favour of respondent workman by controlling authority with a direction to petitioner corporation to pay remaining amount of gratuity with interest of delayed payment of gratuity to respondent workman. being aggrieved by said order passed by controlling authority, petitioner corporation has challenged order passed by controlling authority, nadiad before appellate authority and appellate authority has.....
Judgment:
1. Heard learned advocate Mr. Hardik C. Rawal appearing on behalf of petitioner - Divisional Controller, Gujarat State Road Transport Corporation, Divisional Office, Nadiad ('petitioner Corporation' for short).

2. In this group of petitions, petitioner has challenged order passed by Controlling Authority, Nadiad in Gratuity Application filed by respondent workman and same has been decided in favour of respondent workman by Controlling Authority with a direction to petitioner Corporation to pay remaining amount of gratuity with interest of delayed payment of gratuity to respondent workman. Being aggrieved by said order passed by Controlling Authority, petitioner Corporation has challenged order passed by Controlling Authority, Nadiad before Appellate Authority and Appellate Authority has also dismissed Appeal filed by petitioner Corporation. Therefore, both orders passed by Controlling Authority as well as Appellate Authority are under challenge in present group of petitions.

3. Learned advocate Mr. Hardik C. Rawal appearing on behalf of petitioner Corporation submitted that respondent workman was superannuated from service and was paid amount of gratuity which was available as per Rules of Corporation. The workman approached Controlling Authority under Payment of Gratuity Act, 1972 ('Act' for short) for payment of gratuity amount and interest on late payment as well as for difference of gratuity amount because of merger of 50% dearness pay as per Circular No.1944 dated 30^th December, 2008 issued by petitioner Corporation. He submitted that it is necessary to consider that by Circular No.1944 dated 30^th December, 2008, the petitioner Corporation has decided to merge dearness pay with basic pay w.e.f. 31^st December, 2008 at a rate of 50%, but, difference between 1^st April, 2008 to 31^st December, 2008 was to be paid only after issuance of further instructions. He also submitted that it was further provided in Condition No.5 of Circular No.1944 dated 30^th December, 2008 that this increase on dearness pay shall not be considered for purpose of payment/calculation of amount of Gratuity, Overtime, CLA and other allowances. He submitted that this interim decision was taken after calculating approximate financial burden, long pending agitation of workman and resultant talks with recognized Unions and its implementation was, therefore, possible only if conditions stipulated therein are satisfied and approval of Government was also on that ground. He emphasized that final settlement between petitioner Corporation and recognized Unions have also arrived at and petitioner Corporation has granted benefits of 6^th Pay Commission w.e.f. 1^st April, 2008 and its actual effect has started from 1^st January, 2011 by Circular No.1992 dated 3^rd November, 2010. Therefore, according to petitioner Corporation, in view of Circular No.1992 dated 3^rd November, 2010, respondent workman is now entitled to more amount of gratuity than awarded, but, same has to be paid as per disbursement modalities that may be arrived at by way of settlement within next few months. However, Controlling Authority and Appellate Authority, by not properly considering aforesaid Circular and resultant financial impact upon petitioner Corporation, directed to pay amount towards amount of difference in gratuity with 10% simple interest upon delayed payment. He also submitted that Controlling Authority as well as Appellate Authority has decided matter without proper application of mind and without appreciation of effect of Circular and financial circumstances of petitioner Corporation, therefore, both orders are under challenge. The petitioner Corporation has annexed Circular No.1944 dated 30th December, 2008 as well as Circular No.1992 dated 30th October/November, 2010 along with present group of petitions. In support of submissions, learned advocate Mr. Rawal relied upon one decision of this Court in case of Gujarat State Road Transport Corporation V/s. Chandrakant Tapubhai Vyas reported in 2004(2) GLH 23. He submitted that question which was raised for consideration by this Court in that group of petitions whether statutory liability is attracted for payment of gratuity as per Section 4(2) of Act on account of subsequent revision of pay scale after date of retirement or not He submitted that this aspect, in detail, has been examined by this Court in aforesaid decision and therefore, this decision is to be considered by this Court in present group of petitions. Except that, no other submission is made and no other decision is cited by learned advocate Mr. Hardik C. Rawal appearing on behalf of petitioner Corporation.

4. I have considered submissions made by learned advocate Mr. Rawal and I have also perused orders passed by Controlling Authority as well as Appellate Authority and Circular No.1944 dated 30th December, 2008 as well as Circular No.1992 dated 30th October/November, 2010.

5. The respondent workman has approached Controlling Authority, Nadiad and filed an application with a prayer that because of 50% dearness pay merged in basic pay which has been revised last drawn wages of workman was getting by workman at the time of retirement. According to workman, if amount of gratuity under provisions of Act is to be calculated, then, it requires to be calculated on basis of last drawn wages as revised by petitioner Corporation, but, petitioner Corporation has not paid amount of gratuity on the basis of revised wages and whatever amount of gratuity paid to workman, for that, respondent workman is entitled difference of amount of gratuity and also interest upon said difference of amount because of delay in payment of difference of amount of gratuity. On behalf of petitioner Corporation, a reply was filed by Divisional Controller before Controlling Authority, wherein, contention raised by petitioner Corporation was that according to Condition No.5 of Circular No.1944 dated 30th December, 2008, whatever dearness pay revised, upon that, workman is not entitled any amount of House Rent Allowance, CLA, Travelling Allowance and retirement benefits viz., Gratuity and other allowances including overtime, means, according to contentions raised by petitioner Corporation, as this revised dearness pay is merged as per Circular No.1944 dated 30th December, 2008, workman is not entitled amount of gratuity on revised salary. The Controlling Authority has considered whatever contentions raised by Corporation in reply and also considered Circular No.1944 dated 30th December, 2008 and thereafter, considered fact that w.e.f. 1st April, 2008, 50% dearness allowance has been merged with basic salary which has to be considered as dearness pay or treated as dearness pay and on being such merger of 50% dearness allowance in basic salary, ultimate salary of workman is to be revised and on that basis, amount of gratuity is required to be calculated by Corporation. The Controlling Authority has considered various provisions of Act and also considered that after retirement of workman from service, within one month, amount of gratuity is required to be paid and if it is not paid within a period of one month, then, whatever delayed period, workman is entitled simple interest upon said delayed payment under Section 7(3A) of Act. The Controlling Authority has considered in detail and also calculated amount of gratuity while dividing per day wages of 26 days in a month and come to conclusion that workman is entitled amount of gratuity on revised wages which was fixed by petitioner Corporation at last month of retirement. For delayed payment, 10% simple interest has been awarded by Controlling Authority under Section 7(3A) of Act. The petitioner Corporation has not paid amount of gratuity in time as per provisions made under Act, but, it was paid after some period; means there was a delayed payment by petitioner Corporation. For that, Controlling Authority has awarded 10% simple interest and order has been passed accordingly by Controlling Authority.

6. Similarly, in appeal, Appellate Authority has also considered only contention raised by petitioner Corporation relying upon Circular No.1944 dated 30th December, 2008, Condition No.5 has been pressed into service and condition No.5 incorporated in circular that whatever dearness allowance has been merged in basic salary of workman, upon that, amount of gratuity is not required to be paid; means, difference of gratuity is not required to be paid by petitioner Corporation as it has been agreed by Unions. Therefore, order passed by Controlling Authority is contrary to settlement as well as approval given by State Government. The contention raised by respondent workman before Appellate Authority that according to provisions of Act and definition of 'wages', whatever salary revised and received by workman in a last month of retirement, that salary must have to be considered being a last drawn wages and on that basis, Controlling Authority has rightly calculated difference of amount of gratuity and for delayed payment, this being a statutory payment which must have to be paid by petitioner Corporation which has not been paid, therefore, Controlling Authority has rightly granted such amount in favour of respondent and after considering Circular dated 22nd September, 2010, respondent workman is entitled difference amount of gratuity and accordingly it has been granted by Controlling Authority. For that, Controlling Authority has not committed any error, then, appeal is required to be dismissed.

7. The Appellate Authority, after considering aforesaid submissions made by both parties, has come to conclusion that any provision if it is made in Circular No.1944 dated 30^th December, 2008 relied upon by petitioner Corporation, is contrary to provisions of Act and that circular is not binding to Controlling Authority as well as Appellate Authority. The Circular dated 22^nd September, 2010 issued by petitioner Corporation has also been considered by Appellate Authority, where, 50% dearness allowance has been merged with basic pay and accordingly, calculation is required to be made w.e.f. 1^st April, 2008 and workman has been retired subsequent to 1^st April, 2008. Therefore, Controlling Authority has rightly considered Circular dated 22^nd September, 2010 issued by petitioner Corporation and for that, according to Appellate Authority, Controlling Authority has rightly examined matter and no error is committed by Controlling Authority, which requires interference by Appellate Authority. Accordingly, appeal preferred by petitioner Corporation has been dismissed.

8. I have considered finding and reasoning given by Controlling Authority as well as Appellate Authority.

It is necessary to consider various provisions of Payment of Gratuity Act, 1972 as under :

Definition of 'wages' - "Sec.2(s) - "wages" means all emoluments which are earned by an employee while on duty or on leave in accordance with the terms and conditions of his employments and which are paid or are payable to him in cash and includes dearness allowance but does not include any bonus, commission, house rent allowance, overtime wages and any other allowance."

"Sec.4(2) - For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days' wages based on the rate of wages last drawn by the employee concerned :

Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account :

Provided further that in the case of [an employee who is employed in a seasonal establishment and who is not so employed throughout the year], the employer shall pay the gratuity at the rate of seven days' wages for each season.

[Explanation - In the case of a monthly rated employee, the fifteen days' wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen.]"

"Sec.4(5) - Noting in this section shall affect the right of an employee to receive better terms of gratuity under any award or agreement or contract with the employer."

"Sec.7 (2) - As soon as gratuity becomes payable, the employer shall, whether an application referred to in sub-section (1) has been made or not, determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the controlling authority specifying the amount of gratuity so determined."

"Sec.7(3) - The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable to the person to whom the gratuity is payable."

"Sec.7(3A) - If the amount of gratuity payable under sub-section (3) is not paid by the employer within the period specified in sub-section (3), the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long-term deposits, as that Government may, by notification specify :

Provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has obtained permission in writing from the controlling authority for the delayed payment on this ground."

"Sec. 14. Act to override other enactments, etc. - The provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act."

9. In view of aforesaid provisions made under Act, definition of 'wages' suggests that all emoluments which are earned by an employee while on duty or on leave in accordance with terms and conditions of his employments and which are paid or are payable to him in cash and includes dearness allowance but does not include any bonus, commission, house rent allowance, overtime wages and any other allowance. The workman after retirement entitled amount of gratuity for every completed year of service or part thereof in excess of six months. The employer shall pay gratuity of an employee at the rate of 15 days wages based on rate of wages last drawn by employee concerned.

10. Section 4(5) suggests that nothing in this section shall affect right of an employee to receive better terms of gratuity under any award or agreement or contract with employer. The payment of gratuity is to be made by employer within a period of one month from date of entitlement of such amount as per Section 7 sub-section 3 of Act and if amount of gratuity payable under Section 7 sub-section 3 is not paid by employer within a period specified in sub-section 3, employer shall pay from date on which gratuity becomes payable to date on which it is paid, simple interest at such rate, not exceeding rate notified by Central Government from time to time for repayment of long-term deposits, as that Government may, by notification specified, but, if delay in payment is due to fault of employee and then employer has obtained permission in writing from controlling authority for delayed payment, no such interest is payable to workman. Any contract or agreement or settlement if it is contrary to basic provisions of Act, then, under Section 14 of Act, this Act having overriding effect to other enactments means provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act.

11. In light of aforesaid mandatory provisions Section 14 of Act, Condition No.5 as referred by learned advocate Mr. Rawal of Circular No.1944 dated 30^th December, 2008 is contrary to provisions of Act and that condition cannot operate against interest of workman which has been protected by provisions of Act, 1972. That aspect has been properly considered by Controlling Authority as well as Appellate Authority. The Controlling Authority as well as Appellate Authority has considered circular issued by petitioner Corporation dated 22^nd September, 2010 for implementation of Circular No.1944 dated 30^th December, 2008, wherein, last drawn wages of workman has been revised because of 50% dearness allowance is merged with basic salary of workman w.e.f. 1^st April, 2008. It was decided by petitioner Corporation in favour of workman by circular dated 22^nd September, 2010 that salary of each workman those who are in service on 1^st April, 2008 is to be revised and workman is entitled a difference of amount of such revision in cash from petitioner Corporation. Therefore, any workman who has been retired subsequent to 1^st April, 2008 then his salary is to be revised on the basis of circular issued by Corporation dated 22^nd September, 2010 and on that basis, a difference of amount revised wages is to be paid in cash by petitioner Corporation to workman, therefore, actually, last drawn wages of workman has been revised w.e.f. 1^st April, 2008 and workman is retired subsequently from service, then, workman is entitled amount of gratuity under provisions of Act on the basis of revised salary which was received by workman as per petitioner Corporation's circular dated 22^nd September, 2010. The decision which has been taken by Controlling Authority and Appellate Authority relying upon circular issued by petitioner Corporation is not disputed by advocate of petitioner Corporation and not only that but that circular has been fully implemented by Corporation in favour of workman and on that basis, salary of workman those who were in service on 1^st April, 2008, that was revised as per circular dated 22^nd September, 2010 and on that basis, calculation which has been made by Controlling Authority and confirmed by Appellate Authority, for that, according to my opinion, either of authority has not committed any error which required interference by this Court. The decision which is relied upon by learned advocate Mr. Rawal of this Court in case of Gujarat State Road Transport Corporation (supra) is not applicable to facts of present case, because, in this case, w.e.f. 1^st April, 2008, as per circular dated 22^nd September, 2010 issued by Corporation, actually, in reality salary of workman those who were in service has been revised not only that but difference of amount because of such revision has to be paid by Corporation in cash to concerned workman and facts of present case are totally different than facts of decision cited by learned advocate Mr. Rawal. The said decision which is relied upon by learned advocate Mr. Rawal is not applicable to facts of this case. Therefore, considering facts which are on record which has been taken into account by both authorities, for that, according to my opinion, Condition No.5 which has been heavily relied upon by learned advocate Mr. Rawal based on Circular No.1944 dated 30^th December, 2008 cannot operate against mandatory provisions of Act and it is also contrary to Section 14 of Act. The interest has been rightly granted considering mandate of Section 7 (3A) of Act.

12. The right to have gratuity amount being a statutory right is decided by Apex Court in case of D.V. Kapoor v. Union of India reported in AIR 1990 SC 1923. The workman is entitled amount of gratuity under Section 4(5) having better terms of gratuity under any award or agreement or contract with employer.

13. Learned advocate Mr. Rawal heavily relied upon decision of this Court in case of Gujarat State Road Transport Corporation (supra). This Court has considered one fact that date on which employee concerned retired, on that day, there was no revision of pay-scale in existence. This Court has also observed that it may be that on account of revision of pay scale consequentially there may be liability of payment of gratuity in future, but, merely because a decision is taken for revising pay-scale, but, its effect was not given and for gratuity, no decision was taken which cannot be concluded that gratuity was admissible to employees concerned as on 1^st August, 2000.

14. In light of aforesaid observation made by this Court, facts of this case is altogether different, because, in this case, as per Circulars dated 30^th December, 2008, 30^th October/November, 2010 and 22^nd September, 2010 revision of pay because of merger of 50% dearness allowance in basic pay as already given effect w.e.f. 1^st April, 2008 and accordingly, salary also revised and further decision was taken to calculate difference of salary those who have retired subsequent to 1^st April, 2008 and that difference of salary is also to be paid on or before January, 2011. Therefore, as per Circular dated 22^nd September, 2010 in fact it has been implemented and accordingly salary was revised and effect has been given from 1^st April, 2008 and difference of amount is also paid to workman, then, naturally, last drawn wages of workman actually has been revised and effect has been given by Corporation because of Circular dated 22^nd September, 2010 which has been rightly considered by Controlling Authority as well as Appellate Authority, then, decision as referred above of this Court is not applicable to facts of this case.

15. Apart from that any award of Industrial Tribunal or any Contract or Agreement is made by employer with employee which is inconsistence with statutory provisions governing service condition cannot be enforced as decided by Apex Court in case of N.S. Giri v. The Corporation of City of Mangalore and other reported in AIR 1999 SC 1958.

16. Similarly, if pre-agreement of service with workman found to be inconsistent with provisions of standing order of Company, that has been held to be not valid by Apex Court in case of Western India Match Co. Ltd., v. workmen reported in AIR 1973 SC 2650.

17. Similarly, Condition No.5 incorporated as per Circular No.1944 dated 30^th December, 2008 not to consider this revision of pay for payment of gratuity amount is also inconsistent to statutory provisions of Act, therefore, such Condition No.5 cannot be enforced contrary to law against workman and such Condition No.5 is not binding to workman while claiming difference of amount of gratuity and interest upon delayed payment by workman against Corporation. The question arose to interpret any of provisions of labour legislation, then, how to be looked into, that aspect has been considered by Apex Court in case of M.C. Chamaraju v. Hind Nippon Rural Industrial (P) Ltd., reported in (2007) 8 SCC 501. The relevant discussion is made in paragraph 14 and 15 which are quoted as under :

"14. In our considered opinion, the Division Bench ought not to have undertaken the above exercise which had been done by the Controlling Authority as also by the Appellate Authority. The High Court was exercising power of 'judicial review' which, in its inherent nature, has limitations. This is particularly true since the learned Single Judge also did not think it fit to interfere. We are, therefore, of the view that the Division Bench was wrong in setting aside all the orders and in allowing the appeal of the Management and in dismissing the application filed by the workman.

15. There is another aspect also which is relevant. The Act has been enacted with a view to grant benefit to workers, a 'weaker section' in industrial adjudicatory process. In interpreting the provisions of such beneficial legislation, therefore, liberal view should be taken. A benefit has been extended by the Authorities under the Act to the workman by recording a finding that the applicant (appellant herein) had completed requisite service of five years to be eligible to get gratuity. In that case, even if another view was possible, the Division Bench should not have set aside the findings recorded by the Authorities under the Act and confirmed by a Single Judge by allowing the appeal of the employer."

Section 7(3A) of Act has been interpreted by Apex Court in case of H. Gangahanume Gowda v. Karnataka Agro Industries Corpn. Ltd., reported in 2003 AIR SCW 885, where, paragraph 7 and 9 are relevant, therefore, same are quoted as under :

"7. It is evident from Section 7(2) that as soon as gratuity becomes payable, the employer, whether any application has been made or not, is obliged to determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the Controlling Authority specifying the amount of gratuity. Under Section 7(3), the employer shall arrange to pay the amount of gratuity within 30 days from the date it becomes payable. Under sub-section (3A) of Section 7, if the amount of gratuity is not paid by the employer within the period specified in sub-section (3),

he shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate not exceeding the rate notified by the Central Government from time to time for repayment of long term deposits; provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has obtained permission in writing from the controlling authority for the delayed payment on that ground. From the provisions made in Section 7, a clear command can be seen mandating the employer to pay the gratuity within the specified time and to pay interest on the delayed payment of gratuity. No discretion is available to exempt or relieve the employer from payment of gratuity with or without interest as the case may be. However, under the proviso to Section 7(3A), no interest shall be payable if delay in payment of gratuity is due to the fault of the employee and further condition that the employer has obtained permission in writing from the Controlling Authority for the delayed payment on that ground. Under Section 8, provision is made for recovery of gratuity payable under Act, if not paid by the employer within the prescribed time. The Collector shall recover the amount of gratuity with compound interest thereon as arrears of land revenue and pay the same to the person entitled. A penal provision is also made in Section 9 for non-payment of gratuity. Payment of gratuity with or without interest as the case may be does not lie in the domain of discretion but it is a statutory compulsion. Specific benefits expressly given in a social beneficial legislation cannot be ordinarily denied. Employees on retirement, have valuable rights to get gratuity and any culpable delay in payment of gratuity must be visited with the penalty of payment of interest was the view taken in State of Kerala and Ors. v. M. Padmanabhan Nayyar, 1985 (50) Fac LR 145. Earlier there was no provision for payment of interest on the delayed payment of gratuity. Sub-section (3A) was added to Section 7 by an amendment, which came into force with effect from 1st October, 1987. In the case of Charan Singh v. M/s. Birla Textiles and Another, 1988 (57) Fac LR 543 SC, this aspect was noticed in the following words :

"There was no provision in Act for payment of interest when the same was quantified by the Controlling Authority and before the Collector was approached for its realization. In fact, it is on the acceptance of the position that there was a lacuna in the law that Act 22 of 1987 brought about the incorporation of sub-section (3A) in Section-7. That provision has prospective application."

9. It is clear from what is extracted above from the order of learned single Judge that interest on delayed payment of gratuity was denied only on the ground that there was doubt whether the appellant was entitled to gratuity, cash equivalent to leave etc., in view of divergent opinion of the Courts during the pendency of enquiry. The learned single Judge having held that the appellant was entitled for payment of gratuity was not right in denying the interest on the delayed payment of gratuity having due regard to Section 7(3A) of Act. It was not the case of the respondent that the delay in the payment of gratuity was due to the fault of the employee and that it had obtained permission in writing from the Controlling Authority for the delayed payment on that ground. As noticed above, there is a clear mandate in the provisions of Section 7 to the employer for payment of gratuity within time and to pay interest on the delayed payment of gratuity. There is also provision to recover the amount of gratuity with compound interest in case amount of gratuity payable was not paid by the employer in terms of Section 8 of Act. Since the employer did not satisfy the mandatory requirements of the proviso to Section 7(3A), no discretion was left to deny the interest to the appellant on belated payment of gratuity. Unfortunately, the Division Bench of the High Court, having found that the appellant was entitled for interest, declined to interfere with the order of the learned single Judge as regards the claim of interest on delayed payment of gratuity only on the ground that the discretion exercised by the learned single Judge could not be said to be arbitrary. In the first place in the light of what is stated above, the learned single Judge could not refuse the grant of interest exercising discretion as against the mandatory provisions contained in Section 7 of Act. The Division Bench, in our opinion, committed an error in assuming that the learned single Judge could exercise the discretion in the matter of awarding interest and that such a discretion exercised was not arbitrary."

18. In view of above observations made by Apex Court interpreting mandate of Section 7(3A) of Act, no discretion is available to petitioner Corporation and Controlling Authority as well as Appellate Authority to refuse or deny interest to workman on delayed payment of gratuity amount, therefore, contentions raised by learned advocate Mr. Rawal cannot be accepted. The view taken by Controlling Authority as well as Appellate Authority is in consonance with provisions of Act and Condition No.5 of Circular No.1944 dated 30^th December, 2008 is contrary to provisions of Section 14 of Act. When actual salary has been revised and difference of amount of revised salary is to be paid in cash w.e.f. 1^st April, 2008, then, whoever employee retired subsequent to 1^st April, 2008 is definitely entitled amount of gratuity on revised last drawn wages which has been revised as per Circular No.1944 dated 30^th December, 2008 as well as 22^th September, 2010 and Circular No.1992 dated 30^th October/November, 2010. For that, no error is committed by either of authority which requires interference by this Court while exercising powers under Article 227 of Constitution of India.

19. It is necessary to note that as per condition incorporated in Circular No.1992 dated 30^th October/November, 2010, page 18, salary is to be revised as per Item No.2, page 22, w.e.f. 1^st April, 2008 and pay fixation is to be carried out even in respect of retired employees or who died in between and an employee who has been dismissed or discharged for any reasons before 15^th January, 2011. This being a condition incorporated in aforesaid circular Item No.1 suggests that after receiving approval from State Government, new revision of pay scale is to be implemented w.e.f. 1^st January, 2011 and it also applies to employees who have been retired or died or dismissed which suggested to implement pay revision as well as 50% dearness allowance is to be merged with basic pay is to be revised w.e.f. 1^st April, 2008. In facts of this group of petitions, workman who has been retired subsequent to 1^st April, 2008 and for that, there is no factual dispute raised by petitioner Corporation either before Controlling Authority or before Appellate Authority. Therefore, combined reading of both Circulars No.1944 and 1992 in facts of this case, respondent workman is entitled amount of gratuity on the basis of last drawn wages as revised on basis of aforesaid two circulars and for that, workman is entitled difference of amount of gratuity and on delayed payment, workman is also entitled interest being a statutory, for that, Corporation, Controlling Authority and Appellate Authority having no discretion to deny such statutory interest to respondent workman.

20. In view of above, there is no substance in present group of petitions. Accordingly, present petitions are dismissed.


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