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High Court Of Calcutta
SATYABRATA SINHA, PRATAP KUMAR RAY
TEXMACO LTD. - Appellant
Versus
APPELLATE AUTHORITY - Respondent
MAT 1920 Of 2000
Decided On : 11/28/2000
PAYMENT OF GRATUITY ACT, 1972 - INTERPRETATION - SECTION 2-A, 4, 7, 25-FF, 25-FFF - INDUSTRIAL DISPUTES ACT, 1947 - SECTION 2 (P), 18, 25-F, 25-FF, 25-FFF - WORKMEN'S COMPENSATION - CLOSURE OF INDUSTRY - LIABILITY OF PAYMENT OF GRATUITY - CONTINUITY OF SERVICE - EFFECT OF SETTLEMENT AGREEMENT - JURISDICTION OF CONTROLLING AUTHORITY UNDER THE PAYMENT OF GRATUITY ACT.
Fact of the Case:
The erstwhile employer declared a lock-out in October 1978 and closure in January 1979. Negotiations were held, and a tripartite agreement was executed between the petitioner, the erstwhile employer, and the workmen's union. The petitioner took over the industry in March 1983, and the respondent, an employee of the erstwhile employer, resumed his duties in April 1983. The respondent retired in January 1989 and was paid gratuity for his services with the erstwhile employer and the petitioner. Dissatisfied, he filed an application before the Controlling Authority claiming continuous service and entitlement to gratuity for the entire period of his service. The Controlling Authority allowed the application, which was upheld by the Appellate Authority. The petitioner's writ petition challenging the orders was dismissed by the High Court.
Finding of the Court:
The High Court held that the tripartite settlement agreement was binding on the respondent and that he could not claim continuous service without a break. The Court also held that the petitioner, being a transferee, was not liable to pay compensation under Section 25-FFF of the Industrial Disputes Act, as amended by the State of West Bengal, since the proviso to the section was not applicable. The Court further held that the Controlling Authority under the Payment of Gratuity Act did not have jurisdiction to resolve an industrial dispute and that the respondent's remedy, if any, was to file an application under Section 33-C (2) of the Industrial Disputes Act.
Issues: 1. Whether the tripartite settlement agreement was binding on the respondent and barred his claim for continuous service and gratuity for the entire period of his service? 2. Whether the petitioner, as a transferee, was liable to pay compensation under Section 25-FFF of the Industrial Disputes Act, as amended by the State of West Bengal? 3. Whether the Controlling Authority under the Payment of Gratuity Act had jurisdiction to resolve an industrial dispute?
Ratio Decidendi: 1. The tripartite settlement agreement was binding on the respondent, and he could not claim continuous service without a break. The agreement provided for the petitioner to take over the liability of gratuity payable under the Payment of Gratuity Act, 1972, due to the workmen up to the date of the closure notice. The workmen, including the respondent, agreed to accept fresh employment with the petitioner, and the gratuity payable for their service with the erstwhile employer would be paid along with the gratuity due for their fresh employment. The respondent, having taken advantage of the settlement and re-employment, was estopped from taking a different plea and claiming continuous service. 2. The petitioner, as a transferee, was not liable to pay compensation under Section 25-FFF of the Industrial Disputes Act, as amended by the State of West Bengal, since the proviso to the section was not applicable. The proviso requires prior payment of compensation to the workmen as a condition precedent to the closure of any undertaking. However, in this case, the closure had already taken place before the amendment came into force, and the petitioner was not responsible for the non-payment of compensation by the erstwhile employer. 3. The Controlling Authority under the Payment of Gratuity Act did not have jurisdiction to resolve an industrial dispute. The Payment of Gratuity Act is a self-contained Code dealing with the payment of gratuity to employees, and it does not confer jurisdiction on the Controlling Authority to adjudicate industrial disputes. The respondent's remedy, if any, was to file an application under Section 33-C (2) of the Industrial Disputes Act.
Final Decision: The High Court allowed the petitioner's appeal, set aside the orders of the Appellate Authority and the Controlling Authority, and dismissed the respondent's writ petition.
( 1 ) THIS appeal is directed against a judgment and order dated May 17, 2000 passed by a learned single Judge of this Court whereby and whereunder the writ petition filed by the appellant herein questioning an order passed by the appellate authority affirming the order of the controlling authority under the Payment of Gratuity Act, 1972 (hereinafter called and referred to for the sake of brevity as the said Act) was dismissed.
( 2 ) THE basic fact of the matter is not in dispute. The respondent No. 3 herein was an employee of Oriental Machinery and Civil Construction Limited (hereinafter referred to as OMCC ). The said establishment having regard to certain labour disputes declared a lock-out in October, 1978. A closure was declared in relation to the said industry with effect from January 1, 1979. Negotiations were held by and between the management of the said OMCC and the appellant herein at the instance of the West Bengal for transfer of the said industry, pursuant to or in furtherance whereof, the appellant took over the said industry on or about March 3, 1983. On the same date i. e. March 3, 1978 a tripartite agreement was executed by and between the petitioner herein, the OMCC and all the workmen of the erstwhile undertaking represented by a registered Trade Union known as Oriental Electric and Engineering Company Workers Union.
( 3 ) ALLEGEDLY the aforementioned tripartite agreement was executed at the intervention of the Labour Commissioner, Government of West Bengal. Pursuant to or in furtherence of the said tripartite agreement the petitioner herein agreed to offer fresh employment to the permanent workmen of OMCC who were on its role on the date of closure. As regard the liability of payment of gratuity to the concerned workmen it was agreed that such liability till the date of closure notice would be taken over by the petitioner, the amount in relation whereto, however, would be payable to the concerned workmen as and when they reach the age of superannuation together with the amount of gratuity which would become due and payable by the petitioner herein for their fresh employment.
( 4 ) A deed of transfer of the said undertaking was executed by the parties on September 1, 1983 although the possession thereof, as indicated hereinbefore, had been handed over in March, 1983. The respondent No. 3 herein retired on January 3, 1989. The petitioner paid his gratuity dues for his services with the OMCC from February 11, up to the date of closure as also for the period of his service with the petitioner from January 3, 1989. The respondent No. 3 being not satisfied, filed an application before the Controlling Authority in terms of the provision of the said Act praying therein that he may be held to be in continuous service and, thus, is entitled to the gratuity for the entire period of his service. The said application was allowed by an order dated July 8, 1981 by the Controlling Authority. Being aggrieved by and dissatisfied therewith the petitioner herein preferred an appeal which was dismissed by the Appellate Authority in terms of an order dated January 13, 1987 here against the writ application was filed. By reason of the impugned order the learned trial Judge dismissed the said writ application.
( 5 ) MR. Partha Sarathi Sengupta, the learned counsel, appearing on behalf of the appellant, inter alia, submitted that the learned trial Judge went wrong in so far as he failed to take into consideration, the fact that in terms of the aforementioned settlement dated March 3, 1983 the respondent No. 3 was not entitled, to a declaration of continuous service without break. It was contended that in any event, the petitioner being a transferee, the provision of Section 25-FF of the Industrial Disputes Act would be attracted and not Section 25-FFF as amended by the State of West Bengal whereupon reliance has been placed by the authorities under the said Act as also by the learned trial Judge. In an ev
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