JUDGMENT

Rajendra Babu, J.-C.A. No. 5682 2001 @ SLP (C) No. 11497/98

Leave granted.

2. Respondent Nos. 3 to 23 were workmen in the establishment of the appellant. They filed applications under the Payment of Gratuity Act, 1972 [hereinafter referred to as the Act ] for a direction to pay balance of gratuity by the appellant for a period of service rendered by them. Respondent Nos. 3 to 23 retired from the establishment of the appellant and they were paid gratuity calculating basic wages and dearness allowance only. They claimed that they were also paid incentive wages as per Section 4(2) of the Act. The appellant contended that they were governed by settlements and awards regarding wages and other service conditions, which had clearly set out that incentive earnings should not be reckoned as wages for the purpose of provident fund, bonus, gratuity, ESI, overtime etc. They also submitted that the incentive earnings would not partake the character of wages for the purpose of gratuity under the provisions of the Act and that the respondents had already received gratuity on the basis of last drawn basic wages and dearness allowance and, therefore, sought for dismissal of the applications