IN THE HIGH COURT OF JUDICATURE AT PATNA
HARISH KUMAR, J.
CWJC No.11529 of 2019
(6.12.2022)
Food Corporation of India ... Petitioner
vs.
Union of India & Ors. ... Respondents
Payment of Gratuity Act, 1972 – Section 4 – Employer has right to withhold gratuity during pendency of disciplinary proceedings – Before superannuation of an employee, who was departmentally proceeded with and in terms of regulation, inflicted with punishment of compulsory retirement from service of Corporation with forfeiture of entire amount of gratuity employee would only be entitled for payment of gratuity on the basis of outcome of departmental proceeding – Impugned order of Controlling Authority directing petitioner to pay gratuity to respondent as also appellate order upholding order of Controlling Authority set aside – Payment of gratuity shall be subject to final outcome of complaint case. (Paras 13 to 16)
State Bank of India Vs. Ramlal Bhaskar, 2011 (10) SCC 249 – Referred.
Chairman-cum-Managing Director, Mahanadi Coalfields Ltd. Vs. Sri Rabindranath Choubey, 2020 (3) PLJR 438 (SC); Chairman-cum-Managing Director, Mahanadi Coalfields Ltd. Vs. Sri Rabindranath Choubey, Civil Appeal No. 9693 of 2013 – Relied.
Harish Kumar, J.—Heard Mr. Saket Tiwary, learned counsel for the petitioner, Mr. Uday Prakash Sharma, learned counsel for the respondent no.4 and Mrs. Kanak Verma, learned central government counsel for the Union of India.
2. By filling the present writ application, the petitioner Food Corporation of India seeks quashing of the order dated 30/31.01.2019 passed by the Deputy Chief Labour Commissioner (Central) Patna -cum- Appellate Authority under payment of Gratuity Act, 1972, by which the Appellate Authority has upheld the order of the Controlling Authority dated 31.01.2018 directing payment of gratuity to the respondent no.4 as also for quashing of the order of the Controlling Authority dated 31.01.2018, by which the Controlling Authority has directed the petitioner to pay gratuity to the respondent no.4 amounting to Rs.8,66,411/- along with 10 per cent interest with effect from 31.09.2012 till the date of payment. The petitioner further seeks a direction to restrain the Labour Authorities to release the deposited amount of Rs.8,66,411/-.
3. The short facts, which led to the filing of present writ application is that in the year 2011, while the respondent no.4 was posted as AG-I (Depot) at FSD NRPA, under Food Corporation of India, D.O. Muzaffarpur holding the charge of stock and store as In-charge of shed no.1, shortage of 7,318 bags of Rice and 7940 bags of wheat of total amounting to Rs.1,41,08,020/- was detected during special physical verification.
4. A departmental enquiry was conducted under Regulation 58 and 60A of the Food Corporation of India (Staff) Regulation, 1971 and finally on being found the charges proved, the respondent no.4 inflicted with the penalty of compulsory retirement from service with token recovery of Rs.10,00,000/- in lump-sum, which was to be recovered from the terminal dues including gratuity vide order dated 30.08.2012 (Annexure-5 to the writ petition).
5. The said order of Disciplinary Authority was challenged by the respondent no.4 before the Appellate Authority, however, after considering the amount of loss suffered by the Corporation the Appellate Authority modified the order of punishment to the extent of compulsory retirement from the service of the Corporation with forfeiture of entire amount of gratuity of the respondent no.4. The respondent no.4 being aggrieved, assailed the order of punishment as well as the Appellate Authority before the Central Government Industrial Tribunal (CGIT), Dhanbad, by filing Complaint Case No. 01 of 2013. The learned Central Government Industrial Tribunal, Dhanbad, vide award dated 12.08.2013 held that dismissal of respondent no.4 by the petitioner is illegal.
6. The aforesaid award was challenged by the management of Food Corporation of India by filing W.P. (L) No.2041 of 2014 before the Hon’ble Jharkhand High Court and the Hon’ble Court vide order dated 06/05.02.2016 having heard the parties has been pleased to quash the award dated 12.08.2013 passed by the Central Government Industrial Tribunal (CGIT), Dhanbad and remitted the matter back to the Tribunal in respect of respondent no.4, which is still pending. During the pendency of the matter before the Hon’ble Jharkhand High Court, the respondent no.4 moved before the Controlling Authority under the Payment of Gratuity Act, 1972 and the Assistant Labour Commissioner (Central), Pakur, vide order dated 31.01.2018 directed the petitioner for making payment of gratuity of Rs.8,66,411/- along with interest at the rate of 10 per cent with effect from 31.09.2012 to the date of payment, the aforesaid order of the Controlling Authority as well as the Appellate Authority are subject matter of this writ application.
7. Aggrieved by the aforesaid order the petitioner filed appeal before the Deputy Chief Labour Commissioner (Central), Patna, under the Payment of Gratuity Act, 1972, however, the Appellate Authority vide order 30/31.01.2019 dismissed the appeal of the petitioner upholding the order passed by the Controllin
Gratuity may be withheld pending disciplinary proceedings, dependent on the final outcome of those proceedings under the Payment of Gratuity Act, 1972.
Employer cannot withhold gratuity for unauthorized retention of quarters post-retirement; statutory interest of 10% applies for delayed payment.
1. Departmental proceedings cannot be continued and a penalty cannot be imposed after an employee has ceased to be in service, in the absence of a specific provision for continuation of the proceedin....
Gratuity is a statutory entitlement not subject to withholding after superannuation absent explicit legal grounds for forfeiture, emphasizing employee protection under the Act.
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