The central legal point established in the judgment is that the term 'wage' under the Payment of Gratuity Act, 1972 includes not only what is paid but also what is payable to a workman, and should be interpreted consistent with the principles of equity and fair play.

1. The writ petition is filed by the Chairman and Managing Director, M/s.Hindustan Photo Films, the wholly owned company by the Central Government. The challenge made in this writ petition is to the common order passed by the first respondent in Appeal Nos.280 to 326-A/2007 dated 22.07.2007. The writ petition was admitted on 31.10.2007. Pending writ petition, this court granted an interim stay. For contesting respondents, Mr.K.Elango, learned counsel appears.

2. Respondents 3 to 50 were employees of the petitioner company and they moved the second respondent – Controlling Authority under the Payment of Gratuity Act,1972 with Gratuity Appeals Nos. 299 to 326-A/2007 claiming a difference in gratuity payable to them. Their claim was based upon the interim relief granted to them. Therefore, they moved the applications before the second respondent claiming the computation of the interim relief as part of the wage and for non-payment, they claimed 10% simple interest. The second respondent – Controlling Authority by order dated 04.10.2006 dismissed the claim petitions on the ground that similar issue relating to the same is pending on the file of this Court in W.A.No.498 and 499 of 2006 and closed the individual claim petitions. Against the order dated 04.10.2006, the respondents 3 to 50 preferred Appeal before the first respondent – Appellate Authority in P.G.Appeal Nos.280 to 326-A of 2007.

3. The Appellate Authority by his order dated 27.07.2007 allowed the appeals and set aside the order passed by the second respondent dated 04.10.2006. The appellate authority held that the term wage found in Section 2(s) of the Payment of Gratuity Act, 1972 includes all payments which are earned by an employee while on duty or on leave in accordance with the terms and conditions of his employment and which are paid or are payable to him in cash and includes dearness allowance but does not include any bonus, commission, house rent allowance, overtime wages and any other allowance. Therefore, on the basis of the all inclusive definition, the appellate authority held that the interim relief paid was part of the emoluments which were earned by the employees and it should be automatically treated as wages for calculating gratuity.

4. Challenging this order, the petitioner company had filed this writ petition. It was contended that the petitioner company was having a gratuity scheme and if any dispute regarding the payment, only by an arbitration it can be settled. It was also contended that since the petitioner company had become sick and it was referred to BIFR for framing a scheme and due to the intervention of Central Government's decision to ban wage revision in terms of sick industries, the company had entered into a settlement under Section 18(1) of the Industrial Disputes Act for the payment of interim relief at the rate of 5% of pay. Subsequently, despite a revival package, the company could not be revived. Therefore, the employees were given voluntary retirement in terms of Voluntary Retirement Scheme (VRS) introduced during 1999. At that time, the dues of the employees were paid including gratuity. Therefore, there cannot be any further claim in respect of the payment of gratuity.

5. Since the claim of gratuity was based upon the provisions of the Payment of Gratuity Act, 1972 being a special enactment any claim for payment has to be raised before the authorities under the Act and not before any other forum. This position of law has been clarified by the Supreme Court in State of Punjab Vs. Labour Court, Jullundur and other reported in (1980) 1 SCC 4. In paragraph No.7, the Supreme Court had observed that the Payment of Gratuity Act being a complete code containing detailed provisions covering all the essential features of a scheme for payment of gratuity ; it creates the right of payment of gratuity, indicates when the right will accrue, and lays down the principles for quantification of the gratuity. It provides further for rec