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2022 Supreme(Cal) 738

IN THE HIGH COURT OF CALCUTTA
T. S. Sivagnanam, Hiranmay Bhattacharyya, JJ.
State Bank Of India And Others - Appellant
Versus
Ratan Kumar Rababi And Others - Respondent
FMA No. 652 of 2019, IA No.CAN 2 of 2018 (Old No.CAN 7657 of 2018)
Decided On : 13-05-2022

Advocates appeared:
Soumya Majumder, Advocate, Susanta Pal, Advocate, S. Pal Chowdhury, Advocate, Kallol Basu, Advocate, Suvadip Bhattacharjee, Advocate, Swapnamoy Sarkar, Advocate

The central legal point established in the judgment is that the appellate authority under the 1972 act cannot interfere with the order of punishment passed by the disciplinary authority, and the authority's power to withhold gratuity during pending disciplinary proceedings.

Headnote:

Gratuity - Withholding of Payment - SBIOSR, 1992, Section 4 of the Payment of Gratuity act, 1972 - The court discussed the authority's power to withhold gratuity, the impact of disciplinary proceedings on gratuity, and the applicability of legal provisions in reaching its decision.

Fact of the Case:

The case involved the withholding of gratuity by the employer after the employee's superannuation due to pending disciplinary proceedings. The employee retired on 30.11.2011 and was served with a chargesheet prior to retirement. The disciplinary authority proposed a major penalty of 'removal from service' and 'forfeiture of entire gratuity' under SBIOSR and Section 4 of the 1972 act. The employee appealed for gratuity, which was initially rejected but later granted by the appellate authority under the 1972 act. The employer challenged this decision in a writ petition.

Finding of the Court:

The court held that the appellate authority under the 1972 act exceeded its jurisdiction by modifying the penalty order and granting gratuity. It emphasized that the authority under the 1972 act cannot sit in appeal over the order of punishment passed by the disciplinary authority. The court also discussed the overruling of previous judgments and the impact on the present case.

Issues: The key issues included the authority's power to withhold gratuity during pending disciplinary proceedings, the applicability of service rules and the 1972 act, and the jurisdiction of the appellate authority under the 1972 act.

Ratio Decidendi: The court's decision was based on the principle that the appellate authority under the 1972 act cannot modify or set aside the order of punishment passed by the disciplinary authority. It also considered the impact of overruled judgments and the applicability of legal provisions in the present case.

Final Decision: The court set aside the orders of the appellate authority under the 1972 act and the learned Single Judge, reviving the order of the Controlling authority. The appeal was allowed with no order as to costs.

JUDGMENT

Hiranmay Bhattacharyya, J. - This intra court appeal is directed against a judgment and order dated July 30, 2018 passed by a learned Single Judge in WP 4229 (W) of 2018.

2. The short question that arises for consideration in the instant appeal is whether the appellant/employer was justified in withholding the payment of gratuity of the respondent no. 1/ employee even after his superannuation from service on the ground of pendency of disciplinary proceedings.

3. The facts in a nutshell that are necessary for the consideration of the above issue are as follows:-

The respondent no. 1 (for short 'the employee') joined the service of the State Bank of India (for short 'the employer') as a cashier cum clerk cum typist and he ultimately held the post as Chief Manager (audit). During his posting at Kolkata, local head office, he was served with a chargesheet on 22.10.2011. The respondent employee retired from service on superannuation with effect from 30.11.2011. after completion of the departmental enquiry, the disciplinary authority proposed to impose major penalty of 'removal from service' under Rule 67(1) of State Bank of India Officers' Service Rules, 1992 (for short 'SBIOSR') and 'for forfeiture of entire gratuity' in terms of Section 4 of the Payment of Gratuity act, 1972 (for short 'the 1972 act'). By a letter dated 07.08.2012 an order of major penalty was passed on 10.08.2012 whereby the chargesheeted officer was inflicted with punishment of 'removal from service' under Rule 67(1) of SBIOSR and 'for forfeiture of entire gratuity' in terms of Section 4 of the Payment of Gratuity act, 1972. The respondent preferred a departmental appeal which stood rejected on 19.12.2013. The employee submitted Form N before the Controlling authority under the Payment of Gratuity act, 1972 praying for a direction upon the employer to pay gratuity to him. Controlling authority, by an order dated august 22, 2016, rejected the claim of the respondent against which the employee approached the appellate authority under the 1972 act. appellate authority, by an order dated December 14.12.2017, held that the employee is entitled to be paid gratuity of Rs. 10,00,000/- along with simple interest from the date of superannuation till the date of payment after setting aside the order passed by the Controlling authority. Employer challenged the order dated December 14, 2017 passed by appellate authority under the 1972 act by filing a writ petition being WP 4229(W) of 2018 which was dismissed by a learned Single Judge by a judgment and order dated July 30, 2018. Being aggrieved, employer preferred this intra court appeal.

4. Mr. Majumder, learned advocate for the appellant contended that since the penalty order attained finality, the authority under the 1972 act exceeded its jurisdiction by holding that the respondent is entitled to gratuity which would amount to modifying the penalty order. He further submitted that once the employee accepted the penalty order, his right to claim gratuity stood forfeited. He further submitted that the appellate authority under the 1972 act as well as the learned Single Judge while passing the order impugned relied upon the judgment of the Hon'ble Supreme Court of India in the case of Jaswant Singh Gill vs. Bharat Coking Coal Ltd. reported at (2007) 1 SCC 663 which has since been overruled by a larger bench of the Hon'ble Supreme Court of India in the case of Chairman-Cum-Managing Director, Mahanadi Coalfields Limited vs. Rabindratnath Choubey reported at aIR 2020 SC 2978. He further submitted that in Rabindranath Choubey (supra) it has been held that gratuity can be withheld in case a disciplinary proceeding is pending against an employee.

5. Per contra, Mr. Basu, learned advocate for the respondent contended that SBIOSR do not permit the authority to forfeit the gratuity in any circumstances whatsoever. He further submitted that his statutory right to get gratuity under the 1972 act cannot be curtailed merely on the gro

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