The petitioners are employees working under the third respondent company. The company is engaged in the business of processing fruits and vegetables. The petitioners retired from service after 29 and 31 years respectively. At the time of retirement, they were paid gratuity at the rate of 7 days’ wages for every completed year of service. The petitioners filed application before the Controlling Authority under the Payment of Gratuity Act seeking balance of the gratuity payable at the rate of 15 days’ wages per completed year of service. The third respondent took the contention that the factory of the third respondent is a seasonal establishment and therefore the rate of gratuity payable is only 7 days’ wages per completed year of service. This argument found favour with the controlling Authority who calculated the gratuity at the rate of 7 days’ per completed year of service but found that the gratuity paid to petitioners was short by Rs.2416/- and Rs.268/- respectively and directed the third respondent to pay that amount. The order of the Controlling Authority is Ext.P1. The petitioners herein filed appeals before the appellate authority, who by Ext.P2 common order, dismissed the appeals holding that the third respondent establishment is a seasonal establishment. Exts.P1 and P2 are under challenge in this original petition.

2. The contention of the petitioners is that the third respondent factory is not a seasonal factory and it works through out the year and therefore, they are entitled to 15 days’ wages per completed year of service, as gratuity. On the other hand, the counsel for the third respondent would submit that the third respondent establishment is a seasonal establishment and therefore, only 7 days’ wages per completed year of service is payable as gratuity to the petitioners. He would also submit that the third respondent has been paying this gratuity at the rate of seven days’ wages per year from 1947 onwards which is the year in which factory started functioning. He would further submit that the petitioners themselves, in their evidence, have categorically admitted that the third respondent’s establishment is a seasonal establishment.

3. I have considered the rival contention in detail.

4. The relevant provision regarding payment of gratuity and the rate thereof is contained in Section 4 of the Payment of Gratuity Act, 1972. Sub section 2 of Section 4 reads as follows:

“(2) for every completed year of service or part thereof in excess of six moths, the employer shall pay gratuity to an employee at the rate of fifteen days’ wages based on the rate of wages last drawn by the employee concerned:

Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately proceeding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account:

Provided further that in the case of [an employee who is employed in a seasonal establishment and who is not so employed throughout the year], the employer shall pay the gratuity at the rate of seven days’ wages for each season”.

Going by the above, the rate of 7 days’ wages for each season is applicable to seasonal establishment. In this connection, I note that the Payment of Gratuity Act draws a distinction between a factory and an establishment. Under subsection 3 of Section 1 relating to the applicability of the Act reads as follows:

“(3) It shall apply to –

(a) every factory, mine oilfield, plantation, port and railway company;

(b) every shop or establishment within the meaning of any law for the time being in force in relation to shops and establishments in a State, in which ten or more persons are employed, or were employed, on any day of the preceding twelve months;

(c) such other establishments or class of establishments, in which ten or more employees are employed, or were employed, on any day of the preced