The Court emphasized the importance of issuing a proper show cause notice before forfeiting gratuity and upheld the principle of 'forum convenience' in determining territorial jurisdiction.

JUDGEMENT :

1. Heard.

2. Rule. Rule made returnable forthwith. The writ petition is heard finally with the consent of the learned counsel for the rival parties.

3. The petitioners are officials of the Bank of Maharashtra. The respondent No.1 was an employee of the said Bank and hence, the petitioners are being referred to collectively as the petitioner-employer. The respondent Nos.2 and 3 are formal parties, being the Appellate and Controlling Authorities under the provisions of the Payment of Gratuity Act, 1972 (hereinafter referred to “Act of 1972”).

4. The question that arises for consideration in this petition is, as to whether respondent Nos.2 and 3 were justified in holding in favour of respondent No.1 on the question of entitlement towards payment of gratuity under the provisions of the Act of 1972. The petitioner-employer has raised twofold grounds challenging the impugned orders. Firstly, that the orders passed by the Controlling Authority as well as the Appellate Authority were without jurisdiction, as they did not have territorial jurisdiction to consider the grievance of respondent No.1. Secondly, that the petitioner-employer had correctly forfeited the gratuity payable to the respondent No.1 under section 4(6)(a) of the Act of 1972.

5. Before considering the said grounds of challenge raised on behalf of the petitioner-employer, it would appropriate to briefly refer to the facts leading to filing of the present writ petition. The respondent No.1 joined the petitioner-employer on 19/02/1979 as a directly recruited officer. He was later promoted in the Middle Management Grade in Scale II on 30/08/1988 and thereafter, to the Senior Management Grade Scale-III on 01/07/1995 and further to the Senior Management Grade Scale-IV on 01/01/2003. The petitioner-employer issued a memo on 30/10/2019 levelling six charges against the respondent No.1 for having committed acts of omission and commission during the period between 12/08/2003 to 15/07/2006, when the respondent No.1 was working in the capacity of Chief Manager at New Alipur, Kolkata. A departmental enquiry was conducted against the respondent No.1 on the basis of the aforesaid charges. Upon the respondent No.1 denying the charges, the process of leading evidence was undertaken and eventually, enquiry report was submitted, wherein the respondent No.1 was found guilty of charge Nos.1 to 5, while charge No.6 was held as not proved. After issuing show cause notice to the respondent No.1 and considering his response to the same, by order dated 14/09/2011, the Disciplinary Authority imposed the punishment of compulsory retirement on respondent No.1. Accordingly, the respondent No.1 stood compulsorily retired from the service of the petitioner-employer with effect from 22/09/2011.

6. Aggrieved by the said order, the respondent No.1 filed an appeal before the Appellate Authority but, the appeal was rejected by order dated 14/02/2012, passed by the Appellate Authority, thereby confirming the aforesaid punishment of compulsory retirement imposed on respondent No.1. On 06/10/2012, the petitioner-employer sent a notice to the respondent No.1 at his address at Nagpur, where he had settled after being compulsorily retired, stating that notice regarding forfeiture of gratuity was enclosed. Along with this document, notice rejecting the claim of payment of gratuity in Form-M, as per the Act of 1972 and Rules framed thereunder, was enclosed. The said document stated that the claim of gratuity of the respondent No.1 was found to be inadmissible, as the respondent No.1 had caused loss to the Bank to the extent of Rs.69.72 Lakhs plus unapplied interest thereon, on account of his misconduct.

7. Aggrieved by the said action of the petitioner-employer in denying payment of gratuity, the respondent No.1 filed application under section 7 of the Act of 1972, before the respondent No.3-Controlling