Important Point – Non-payment of gratuity after 30 days from date of severing employer-employee relationship entails interest.

1. Rule. Rule made returnable forthwith and heard finally by the consent of the parties.

2. The petitioner is aggrieved by the judgment and order dated 04/09/2015 delivered by the Appellate Authority / Industrial Court, Ahmednagar under the Payment of Gratuity Act.

3. The petitioner submits that he had joined duties with the respondent on 07/09/1985 and had superannuated on 01/04/2007 after reaching the age of retirement. There is no dispute as regards the continuous service of the petitioner.

4. The petitioner further submits that after completing his tenure of employment till retirement as a Civil Engineer, he was issued with a charge sheet on 24/07/2007 which was after his superannuation. This Court, by its judgment dated 10/12/2015 in Writ Petition No.6795/2013, allowed the petition and concluded that the respondent could not initiate disciplinary proceedings against the petitioner after his retirement. The judgment of the Industrial Court dated 09/07/2013 dismissing Complaint (ULP) No.5/2008 filed by the petitioner was set aside, the complaint was allowed and the impugned order of recovery dated 05/01/2008 was quashed and set aside.

5. The petitioner submits that he had filed Application (PGA) No. 32/2008 before the Controlling Authority claiming gratuity from 07/09/1985 till 01/04/2007. Necessary details were set out in the application form. The only defence taken by the respondent for opposing the claim of gratuity was that the petitioner was overage by one year at the time of joining duties. The proposal for regularizing his services was forwarded after his retirement and the same is still pending. The competent authority, by its judgment dated 09/03/2015, allowed the application of the petitioner and granted him the gratuity considering his last drawn wages. Interest @ 10% was also granted.

6. Mr.Barde submits that the respondent/Corporation preferred Appeal (PGA) No.4/2015 which was allowed by the impugned judgment dated 04/09/2015. The judgment of the Controlling Authority was quashed and set aside and the matter was remitted to the Labour Court for deciding the claim afresh. Grievance is that gratuity is payable to an employee after he completes 5 years in continuous employment. Whether he is a “temporary” or a “permanent” employee is not the criteria for deciding whether he is entitled for gratuity. Mr.Barde, therefore, submits that the impugned judgment is unsustainable.

7. Mr.Bedre, learned Advocate for the respondent/Corporation has strenuously supported the impugned judgment. Contention is that the very entry of the petitioner in service on 07/09/1985 can be said to be an irregular entry until the Competent Authority regularizes his services. In this backdrop, the petitioner is not entitled for gratuity since his service is circumspect. If his services are regularized, his claim for gratuity could be considered. The respondent/Corporation does not have the authority to regularize his services and relax the age criteria. The Industrial Court, which is the Appeal Court, has therefore rightly set aside the judgment of the Controlling Authority.

8. I have considered the submissions of the learned Advocates as have been recorded hereinabove.

9. Section 2A of the Payment of Gratuity Act, 1972 defines “continuous service” as under :-

“2A. Continuous Service

For the purposes of this Act, -

(1) an employee shall be said to be in continuous service for a period if he has, for that period, been in uninterrupted service, including service which may be interrupted on account of sickness, accident, leave, absence from duty without leave (not being absence in respect of which an order (****) treating the absence as break in service has been passed in accordance with the standing orders, rules or regulations governing the employees of the establishment), layoff, strike or a lockout or cessation of work not due to any fault of the employee, whether such uninterrupted or interrupted service was rendered before or after the comme