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1989 Supreme(Mad) 483

High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE SRINIVASAN
S College, Madras - Appellant
Versus
Management of S. I. E. T. WomenMohamed Ibrahim and Others - Respondents
Writ Petition No. 7335/1982
Decided On : 17 October 1989

Appearing Advocates: For

The provisions of the Payment of Gratuity Act, 1972, are applicable to minority institutions and do not violate Article 30(1) of the Constitution of India.

Headnote:

PAYMENT OF GRATUITY ACT - APPLICABILITY TO MINORITY INSTITUTIONS - EDUCATIONAL INSTITUTION RECEIVING GRANT-IN-AID FROM STATE GOVERNMENT - WHETHER PROVISIONS OF ACT VIOLATIVE OF ARTICLE 30(1) OF CONSTITUTION OF INDIA - HELD, NO - PROVISIONS OF ACT ARE APPLICABLE TO MINORITY INSTITUTIONS AND DO NOT VIOLATE ARTICLE 30(1) OF CONSTITUTION OF INDIA.

Fact of the Case:

Petitioner, an educational institution run by a minority trust, challenged the applicability of the Payment of Gratuity Act, 1972 (the 'Act') to it, contending that the Act was not applicable as it was not a factory, mine, oilfield, plantation, port, railway company, shop or establishment falling within the purview of the Act and that it was a minority institution entitled to protection under Article 30(1) of the Constitution of India.

Finding of the Court:

The Court held that the petitioner was an 'establishment' within the meaning of the Act and that the provisions of the Act were applicable to it. The Court further held that the provisions of the Act did not violate Article 30(1) of the Constitution of India as they were regulatory in nature and did not impair or destroy the substance of the right guaranteed under Article 30(1).

Issues: 1. Whether the provisions of the Payment of Gratuity Act, 1972, are applicable to minority institutions? 2. Whether the provisions of the Payment of Gratuity Act, 1972, violate Article 30(1) of the Constitution of India?

Ratio Decidendi: 1. The Court held that the petitioner was an 'establishment' within the meaning of the Act and that the provisions of the Act were applicable to it. 2. The Court held that the provisions of the Act did not violate Article 30(1) of the Constitution of India as they were regulatory in nature and did not impair or destroy the substance of the right guaranteed under Article 30(1).

Final Decision: The Court dismissed the writ petition.

Judgment :-

Srinivasan J.

Whether the provisions of the Payment of Gratuity Act, 1972, hereinafter referred to as the 'Act', are applicable to the petitioner educational institution is the question to be determined by us.The petitioner contends that the Act is not applicable to it because (1) the petitioner is not a factory, mine, oilfield, plantation, port and railway company or a shop or establishment falling within the purview of the Act and (2) the petitioner is a minority institution entitled to the protection under Article 30(1) of the Constitution of India. The prayer in the writ petition is for a declaration that the Act is not applicable to the SIET Women's College run by the SIET Trust.

2. The facts leading to the filling of the writ petition are shortly these : One Smt. Muneera Begum, who was working in the Chemistry Department of the SIET Women's College was electrocuted and she died subsequently. A claim was made by her husband, the first respondent herein, and minor son, the third respondent herein before the Deputy Commissioner of Labour, who was the Additional Commissioner for Workmen's Compensation and it was settled whereupon sum of Rs. 5000/- was paid by the petitioner by way of compromise, though the petitioner's case was that the lady had weak heart and died on account of heart attack and not because of accident. Respondent 1 and 3 filed a petition before the Assistant Commissioner of Labour, who is the Controlling Authority under the Act, claiming the sum of Rs. 3900/- as gratuity due to the deceased lady. The petitioner filed a detailed counter contesting the claim on several grounds including the non-applicability of the Act to the institution. Soon after filing counter, the petitioner approached this Court with this writ petition for the issue of a writ of declaration that the Act is not applicable to the institution in question.

3. Though the respondents were served they did not choose to enter appearance. As the question involved is of some importance we appointed Shri K. Chandru as Amicus Curiae to help us in this matter. We place on record our gratitude and appreciation for the great assistance sincerely rendered by Shri K. Chandru in placing before us all the relevant authorities having a bearing on the case, but for which we might have had some difficulty in answering the question properly.

4. Section1(3) of the Act makes it applicable to (a) every factory, mine, oilfield, 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 10 or more persons are employed, or were employed on any day of the preceding 12 months; (c) such other establishments or class of establishments, in which 10 or more employees are employed on any day of the preceding 12 months, as the Central Government may, by notification, specify in this behalf. There is no dispute that the petitioner does not fall within clause (a) and clause (c). Accordingly to learned counsel for the petitioner clause (b) is not applicable as the petitioner is not a 'shop' or 'establishment' within the meaning of the Tamil Nadu Shops and Establishments Act which is the law for the time being in force in relation to shops and establishments in the State of Tamil Nadu. There is no substance in this contention in view of the decision of the Supreme Court in State of Punjab v. Labour Court, Jullunder and others (1981-I-LLJ-345). In that case it was held that Sec. 1(3)(b) of the Act applied to every establishment within the meaning of any law for the time being in force in relation to an establishment in a State and it was not necessary that the law should be one relating to shops and establishments. The law is expounded thus (p. 355) :".... Section 1(3)(b) speaks of" any law for the time being in force in relation to shops and establishments in a State

". There can be no dispute that the Payment of Wages Act is in force in the State of Pu








































































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