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2024 Supreme(Ker) 1147
IN THE HIGH COURT OF KERALA AT ERNAKULAM
HARISANKAR V. MENON, J.
State Bank of India, Represented by Its Assistant General Manager (HR) - Petitioner
Versus
The Controlling Authority, Oolimiugal, Kakkanad, Kochi & Ors. - Respondents
WP(C) No. 35210 of 2019, WP(C) No. 35330 of 2019
Decided On : 24-10-2024
For the Petitioner: P. Ramakrishnan.
For the Respondent: Sri. Nidhi Balachandran.
IMPORTANT POINT
The court ruled that a fresh appointment severed the connection with prior service, disqualifying former Janatha Deposit Collectors from claiming gratuity for that period under the Payment of Gratuity Act.
Headnote:
(A) Payment of Gratuity Act, 1972 – Entitlement to gratuity – The petitioner challenged orders regarding gratuity claims by former Janatha Deposit Collectors, asserting that their initial service should not count towards gratuity eligibility under the Act. The court found that the appointment as peons was a fresh appointment, severing ties with previous service. (Paras 11-15)
(B) Employment Law – Fresh Appointment – The court emphasized that the terms of the settlement and appointment orders indicated a fresh appointment, thus disqualifying the claim for gratuity based on prior service. (Paras 12-14)
Facts of the case :
The petitioner Bank discontinued the Janatha Deposit Scheme in 2010, leading to the retrenchment of employees. The 3rd respondent claimed gratuity for the entire service period, which the Bank contested.
Findings of Court :
The court ruled that the 3rd respondent's initial service as a Deposit Collector could not be counted for gratuity eligibility under the Act.
Issues : Whether the initial service as Janatha Deposit Collectors should be considered for gratuity eligibility.
Ratio Decidendi : The court held that the fresh appointment as peons severed the connection with prior service, thus not qualifying for gratuity under the Act.
Result : The orders regarding gratuity claims were set aside.
JUDGMENT :
Harisankar V. Menon, J.
The petitioner in these writ petitions is challenging Ext.P8 appellate orders issued by the 2nd respondent in these cases, by which the appeals filed by the petitioner against the proceedings of the 1st respondent stood dismissed.
2. The short facts, necessary for the disposal of these writ petitions, as culled out from W.P.(C) No.35210 of 2019, are as under;
The 3rd respondent in this writ petition was working as a Janatha Deposit Collector essentially on a commission basis from 24.01.1980. It is pointed out that the petitioner Bank discontinued the Janatha Deposit Scheme summarily in the year 2010. On account of such discontinuance, the employees like the 3rd respondent herein were to be retrenched. A settlement was also arrived at between the Bank and similarly placed Janatha Deposit Collectors, as evidenced by Ext.P1. Under the terms of the settlement, it has been specifically recorded at serial No.2 as under;
“2. The bank will discontinue the Janatha Deposit Scheme from 31.08.2010. The Janatha Deposit Collectors below the age of 60 years shall be offered fresh appointment as peons and others will be discontinued. All service benefits due to Janatha Deposit Collectors as per the supreme judgment as on the date of winding up of the Scheme will be paid to them.”
(underlining supplied)
Thus it is recorded that the Scheme would come to an end on account of the discontinuance from 31.08.2010 and those Janatha Deposit Collectors who were below the age of 60 years, would be offered ‘fresh appointment’ as peons and those who have already crossed the age of 60 would be discontinued from service. There is a further Clause to the effect that whatever service benefits available to the Janatha Deposit Collectors till that date-31.08.2010-would be extended pursuant to the directions contained in the judgment of the Apex Court. On the afore basis, the 3rd respondents herein was offered an appointment as peon and he was also appointed pursuant to Ext.P2 proceedings dated 19.08.2010 by the petitioner Bank. A reference to Clause (k) of Ext.P2 would show that the 3rd respondent was placed on 'probation for a period of six months' which is liable to be extended for a further period of three months. The said Clause also speaks about the confirmation of the 3rd respondent in the Bank service at the end of the probation period. The petitioner Bank also points out that the 3rd respondent was paid the gratuity payable to him quantified at Rs.88,424/- as evidenced by Ext.P3.
3. However, it appears that upon the superannuation of the 3rd respondent as peon on 30.09.2014, the 3rd respondent took a stand that he was eligible for the gratuity payable under the Payment of Gratuity Act, 1972 (for short 'the Act') for the entire period when he was in service with the petitioner Bank - the period from 24.01.1980 to 31.08.2010 and the period when he worked as peon pursuant to Ext.P2. The petitioner Bank on the contrary took the stand that whatever gratuity payable for the initial innings, was already paid pursuant to Ext.P3 and as regards the subsequent innings when the 3rd respondent worked as the peon, he is not entitled for any gratuity since the total period he worked as peon was below the minimum eligible period required for the benefits under the said statute.
4. In such circumstances, the 3rd respondent preferred a claim before the 1st respondent herein and by Ext.P6 order dated 27.02.2018, the 1st respondent came to the conclusion that the stand of the 3rd respondent is to be accepted. The 1st respondent therefore issued the order at Ext.P6 directing the petitioner herein to satisfy a total amount of Rs.2,14,491/- towards gratuity for the entire period of 35 years, after reducing the amount already paid as evidenced by Ext.P3.
5. Though a further appeal was preferred by the petitioner against the afore finding, the appeal stood rejected by Ext.P8 order by the 2nd respondent herein. The facts in the second writ petition is al
