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2024 Supreme(Del) 414
IN THE HIGH COURT OF DELHI AT NEW DELHI
C. Hari Shankar, J.
Nitin Kumar - Appellant
Versus
M/s Housing Development Finance Corporation Ltd. - Respondent
RSA 91 of 2019 and CM APP No. 54001 of 2023
Decided On : 26-02-2024
Mr. P.V. Raghunandan, Advocate, for the Appellant.
Mr. Jatin Chaudhary, Advocate, for the Respondent.
IMPORTANT POINT
The central legal point established in the judgment is that the entitlement to gratuity is governed by the provisions of the Payment of Gratuity Act, 1972, and that the limitation period for filing a suit is not subject to condonation in cases of service benefits.
Headnote:
Gratuity - Employment Dispute - Payment of Gratuity Act, 1972, Section 4(1) - The court discussed the provisions of the Payment of Gratuity Act, 1972, particularly Section 4(1), which disentitles an employee to gratuity if the employee has served the organization for less than five years. The court also considered the argument that a contract between the parties could dilute the impact of the Act, but found no evidence to support this claim. The court ultimately held that the appellant was not entitled to gratuity as per the provisions of the Act.
Fact of the Case:
The appellant, a former employee of HDFC, filed a suit claiming terminal benefits, specifically gratuity, after resigning from the company. The lower courts dismissed the appellant's claim, leading to the second appeal before the court.
Finding of the Court:
The court found that the appellant was not entitled to gratuity as per the provisions of the Payment of Gratuity Act, 1972, and that the suit was barred by time. The court upheld the judgments of the lower courts and dismissed the appeal.
Issues: The issues involved the entitlement to gratuity and the limitation period for filing the suit.
Ratio Decidendi: The court held that the appellant was not entitled to gratuity as per the provisions of the Payment of Gratuity Act, 1972, and that the suit was filed beyond the limitation period, leading to the dismissal of the appeal.
Final Decision: The appeal was dismissed, and no orders were made as to costs.
JUDGMENT (Oral)
1. This is a second appeal under Section 100 of the Code of Civil Procedure, 1908 (CPC). The appellant has suffered adverse orders both at the hands of the learned Civil Judge (South East) and, thereafter, at the hands of the learned Additional District Judge (the learned ADJ). The appellant's suit was dismissed by the learned Civil Judge and the first appeal preferred by the appellant was also dismissed by the learned ADJ. The appellant is before this Court in second appeal.
2. The appellant was employed as a Senior Officer with the Housing Development Finance Corporation Limited (HDFC) on 26 October 2009. He resigned from the services of the HDFC on 27 September 2011. The resignation was accepted by the HDFC on 5 December 2011.
3. On the ground that the appellant had been short paid his terminal dues, consequent on his resignation, the appellant instituted Suit 38/2015, subsequently numbered as Suit 50863/2016 (Nitin Kumar v. HDFC and Ors.) before the learned Civil Judge. By way of the suit, the appellant claimed various amounts as terminal benefits, which allegedly remained outstanding.
4. As already noted, the learned Civil Judge rejected the appellant's claim and the learned ADJ has upheld the order of the learned Civil Judge.
5. Before this Court, however, the appellant on 5 July 2022, restricted his case to his claim for gratuity consequent to his resignation from the services of the HDFC.
6. I have heard Mr. P.V. Raghunandan, learned counsel for the appellant and Mr. Jatin Chaudhary, learned counsel for the respondent at length.
7. The issue being brief, no detailed illusion to evidence is necessary. The Court is only concerned with whether the appellant is entitled to gratuity from the respondent. For this reason, the following substantial question of law had been framed by this Court by its order dated 5 July 2022:
"1. Whether the petitioner is entitled to gratuity, from the respondent, in excess of Rs.20,196.50 and, if so, the basis for such entitlement?
2. Whether Civil Suit 38/2015, which was decided by the order dated 28th October, 2016 was barred by time?"
8. Both the Courts below have concurrently held that, as Section 4(1)[4. Payment of gratuity. -
(1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years,-
(a) on his superannuation, or
(b) on his retirement or resignation, or
(c) on his death or disablement due to accident or disease:
Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement:
Provided further that in the case of death of the employee, gratuity payable to him shall be paid to his nominee or, if no nomination has been made, to his heirs, and where any such nominees or heirs is a minor, the share of such minor, shall be deposited with the controlling authority who shall invest the same for the benefit of such minor in such bank or other financial institution, as may be prescribed, until such minor attains majority.
Explanation.-For the purposes of this section, disablement means such disablement as incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement.] of the Payment of Gratuity Act, 1972 permits gratuity to be paid only where the employee concerned has served the organization for five years or more, and the appellant had resigned from the services of the HDFC after serving the HDFC for just two years, no gratuity was payable to the appellant.
9. On 5 July 2022, Mr. Raghunandan's contention was that the Payment of Gratuity Act would not apply where there was any contract to the contrary between the parties.
10. Mr. Raghunandan has not been able to draw my attention to any contract between the appellant and the HDFC which would dilute the effect of Section 4 of the Payment of Gratuity Act. He has instea
