JUDGMENT - SIRPURKAR V.S., J.:---The Principal of a college as also the President of the educational institution have approached this Court challenging the orders passed by the Labour Court, Akola as also the concurring order passed by Appellate Authority, at Nagpur. By these two orders the courts below allowed the application filed by the respondent for the payment of gratuity. The claim of the employee originally as it stood was that he was entitled to be paid the gratuity in the light of the provisions of the Payment of Gratuity Act, 1972 (hereinafter to be referred to as "the Gratuity Act").

2. The application was opposed by the petitioners on number of grounds. Firstly, it was contended that the college or the institution was not an 'industry' and, therefore, there was no question of the application of the Gratuity Act. Secondly, it was stated that even if it was an industry, the salary of the concerned applicant was more than the prescribed limits and, therefore, the petitioners were not liable to pay the gratuity as prayed for. It was submitted further by the petitioners in defendant that the college was affiliated to Nagpur University, Nagpur and, therefore, the college and its employees were governed by the Rules framed by the University. It was claimed that the original applicant's service conditions were governed by the Rules framed by the Nagpur University which were called "Alternate Statute No. 71" and since these Rules did not make any provision for the payment of gratuity, there was no question of the applicant being entitled to get any gratuity. Suffice it to say that the defence was limited to only these three points.

3. The controlling authority before whom the matter was tried came to the conclusion that the question regarding whether the college or the institution was an 'industry' or not was no more res integra and that it was an established position that the said college or the institution was an industry. The concerned authority relied upon the reported decision in (Bangalore Water Supply and Sewerge Board, Etc. v. A. Rajappa and others)1, 1978(I) L.L.J. 349. It is held by the Controlling Authority that the concerned college or the institution which ran the said college was an industry. It seems that probably the challenge was only restricted to the question whether the said college and the institution were an industry. The challenge did not go further than this and it was probably because of that the controlling authority restricted itself only to that question. On merits, the controlling authority, however, held that the objection by the petitioners was not justified and that the applicant was entitled to get Rs. 7,000/- as gratuity on the basis of his salary.

4. An appeal was filed against this decision by the present petitioners under section 7(7) of the Gratuity Act and the Appellate Court also reiterated the findings of the trial authority. In the grounds of appeal, the first ground which is raised is in extremely general terms to say that the provisions of the Gratuity Act were not applicable to the services of the respondent. Again the same question regarding the petitioners not being an industry was reiterated. However, even in appeal the petitioners did not raise any other plea particularly on the lines which is now being raised before this Court. There was, therefore, obviously no finding excepting that the petitioners were the industry. However, probably at the stage of arguments, a question was raised that the petitioners could not be covered under the mischief of the Gratuity Act because of the provisions of section 1(3)(b) of the Payment of Gratuity Act, 1972. It was contended that the word 'establishment' was nowhere defined under the Gratuity Act and, therefore, the definition as given in the Bombay Shops and Establishments Act, 1948 would have to be adhered to. The Appellate Authority basing its judgment on the definition of 'establishment' as given in section 2(8) as also the definition

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