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2022 Supreme(AP) 915

ANDHRA PRADESH HIGH COURT AT AMARAVATI
Ravi Nath Tilhari, J.
Controlling Co-operative Central Bank Ltd – Appellant
Versus
Assistant Commissiner of Labour – Respondent
Writ Petition No. 13203 of 2011
Decided On : 16-09-2022

Advocates appeared:
V.Padmanabharao, Advocate, Suragani Vijaya Kumar, Advocate

The expression 'employer' in Sec. 2(f) of the Payment of Gratuity Act read with Sec. 13 (2) of the General Clauses Act, 1897, would include 'employers'.

Headnote:

PAYMENT OF GRATUITY ACT, 1972 - RELATIONSHIP OF EMPLOYER AND EMPLOYEE - JOINT AND SEVERAL LIABILITY - INTERPRETATION OF STATUTORY PROVISIONS - WRIT PETITION - DISMISSAL:

Fact of the Case:

The petitioner, a District Cooperative Central Bank, filed a writ petition challenging the order of the Controlling Authority under the Payment of Gratuity Act, 1972, which held the petitioner jointly and severally liable to pay gratuity to the 2nd respondent, a former employee of the petitioner. The petitioner contended that it was not the employer of the 2nd respondent and that the 2nd respondent was not its employee. The petitioner also argued that the Controlling Authority erred in holding it jointly and severally liable to pay the gratuity.

Finding of the Court:

The Court held that the petitioner was the employer of the 2nd respondent and that the 2nd respondent was the employee of the petitioner within the meaning of the Payment of Gratuity Act, 1972. The Court also held that the Controlling Authority did not err in holding the petitioner jointly and severally liable to pay the gratuity.

Issues: 1. Whether the petitioner was the employer of the 2nd respondent and the 2nd respondent was the employee of the petitioner within the meaning of the Payment of Gratuity Act, 1972? 2. Whether the Controlling Authority erred in holding the petitioner jointly and severally liable to pay the gratuity?

Ratio Decidendi: 1. The Court held that the petitioner was the employer of the 2nd respondent and that the 2nd respondent was the employee of the petitioner within the meaning of the Payment of Gratuity Act, 1972, based on the following factors: * The petitioner had ultimate control over the affairs of the establishment where the 2nd respondent was appointed and transferred. * The petitioner issued transfer orders and posting orders to the 2nd respondent. * The 2nd respondent was paid by the petitioner. 2. The Court held that the Controlling Authority did not err in holding the petitioner jointly and severally liable to pay the gratuity, based on the following factors: * The expression 'employer' in Sec. 2(f) of the Payment of Gratuity Act read with Sec. 13 (2) of the General Clauses Act, 1897, would include 'employers'. * The petitioner was one of the employers of the 2nd respondent.

Final Decision: The Court dismissed the writ petition.

JUDGMENT

1. Heard Sri V. Padmanabharao, learned counsel, representing Sri Suragani Vijaya Kumar, learned counsel for the petitioner. None appeared for the 2nd and the 3rd respondents to argue the matter.

2. The District Cooperative Central Bank Limited, West Godavari District at Eluru has filed this writ petition under Article 226 of the Constitution of India for issue of a writ more particularly in the nature of writ of certiorari calling for the records in P.G.Case No.1 of 2003 on the file of the 1st respondent-the Controlling Authority under Payment of Gratuity Act, 1972 (in short 'the Act 1972') and Assistant Commissioner of Labour, Eluru, West Godavari District (in short 'the Controlling Authority') and quash the order dtd. 31/3/2011 to the extent the petitioner has also been held liable to pay the gratuity of Rs.1,08,758.00 to the 2nd respondent-Sri S.V.N. Ramachandra Rao jointly with 3rd respondent-the Primary Agricultural Cooperative Society Limited, the petitioner not being the employer and the 2nd respondent not being its employee.

3. The 2nd respondent/the applicant in P.G.Case No.1 of 2003, initially filed the application on 18/12/2001 against the 3rd respondent for payment of gratuity of Rs.1,29,709.00. Later on, he submitted supplemental application on 25/11/2004 and added the District Cooperative Central Bank, the petitioner as opposite party No.2 in P.G.Case.

4. The 2nd respondent stated that he was originally appointed by the Chairman appointment committee for the area of Eluru Cooperative Central Bank Limited, Eluru under the proceedings R.C.Co.Op.No.6676/73-A, dtd. 25/11/1973 as Secretary of Dharmajigudem Cooperative Society and he joined on 1/12/1973. The Chairman appointment committee and the General Manager / Member Secretary of the petitioner District Cooperative Central Bank Limited issued orders of transfers from time to time and from place to place in the area of Eluru Cooperative Central Bank Limited, Eluru. The General Manager of the petitioner bank issued administrative orders dtd. 4/6/1985 transferring the applicant to K.Gokavaram PACS. The applicant worked continuously from 1/12/1973 till the date of his retirmenet on 31/1/2001.

5. The petitioner/opposite party No.2 in P.G.Case filed counter dtd. 19/1/2005 inter alia denying the allegations in the supplemental proceedings and the same not being maintainable and submitting further that the 2nd respondent was appointed by the Chairman appointment committee for the area of Eluru Cooperative Central Bank Limited, Eluru on 25/11/1973 under the Half a Million Job programme and appointed as Secretary of Dharmajigudem PACS. The appointment was made by a separate committee and not by the petitioner and the applicant was not under the administrative control and discipline of the petitioner but was governed by the regulations framed by the Registrar of Cooperative Societies and the pay structure or the service conditions were not governed by the petitioner. The transfer orders were also issued from time to time by the Chairman appointment committee in accordance with the regulations. With respect to the administrative order dtd. 4/6/1985 it was submitted that the said order was issued by the petitioner to the 2nd respondent in the capacity of Member Secretary of the appointment committee. The common cadre constituted in 1973 was abolished and the Registrar was authorized to allot such employees to the Primary Agricultural Cooperative Societies under Sec. 116AA of the Andhra Pradesh Cooperative Societies Act, 1964 (in short 'Act 1964') with effect from 22/4/1985, and accordingly, the 2nd respondent was allotted the 3rd respondent society in pursuance of G.O.Ms.No.454, dtd. 13/9/1985, by the District Collector, West Godavari, Eluru in ROC (Cooperative) No.5859/90-A, dtd. 9/9/1990. The petitioner was neither the employee of the 2nd respondent nor the common cadre constituted prior to the introduction of Sec. 116AA of the Act. The 2nd respondent was only the employe

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