The liability to pay gratuity and leave encashment to employees of private educational institutions lies with the employer, not the State Government.

R.P.Sethi, J.

1. Release of gratuity in favour of the petitioners who are admitted to have been retired from the service of the private respondents, is the main prayer in Civil Writ Petition Nos. 3464, 3465, 10677, 12681 to 12684, 15121, 16055 and 17725 to 17726 of 1995. Some of the petitioners have also prayed for the release of leave encashment and house rent allowance as well. A prayer has also been made for the payment of the amount rent allowance alongwith interest at the rate of 18 percent per annum. As identical question of law on admitted facts are involved in all these writ petitions, the same are being disposed of by a common judgment.

2. The petitioners were the employees of the private educational institutions and as they were not granted the terminal benefits such as gratuity, leave encashment and house rent allowance have preferred writ petitions for the grant of appropriate relief. It is submitted that the respondent-employers were liable to pay the amount of gratuity under the Payment of Gratuity Act, 1972, Rules of the Punjab Government and of the Punjab University. The petitioners have further submitted that they have been regularly contributing towards the provident fund and that the respondents were not justified in refusing to grant the relief as prayed for in these writ petitions. It is further contended that despite the law being very specific and requests made from time to time the respondents have illegally withheld the payment of the aforesaid amount which left the petitioners with no option but to approach this Court for the grant of appropriate relief.

3. In the reply filed on behalf of the official respondents, it is submitted that the liability to pay the terminal benefits is upon the employer and the Government was not liable to contribute for the same. The respondent - employer have submitted that the liability to pay for the claims of the petitioners was that of the State of Punjab as their institutions were getting 95 percent of the grant-in-aid towards the salaries of the sanctioned strength of the College. It is contended that as the State Government has not provided grant-in-aid for payment of gratuity for pension, the respondent-employers could not be burdened with the obligation of making payment to the petitioners. It is, however, conceded that the petitioners which was being run by the Trust registered under the Indian Trust Act. It is also conceded that the Colleges in which the petitioners were employed were affiliated with the Punjab University. Regarding the payment of house rent allowance, it is submitted that there was a dispute regarding the municipal limits of Ludhiana town which was finally settled by the Court after the resignation of the petitioner in C.W.P. No. 3464 of 1995. In that case, the petitioner is stated to have been paid rural area allowance. It is submitted that the College used to get arrears from the Government which were stopped w.e.f. 1.9.1988.

4. We have heard the learned counsel for the parties at length and perused the relevant provisions of law.

5. As the claim of gratuity in all the cases is common, we propose to deal with the said claim in the first instance. Under the Payment of Gratuity Act, 1972, a duty is cast upon the employer to pay to its employees gratuity on the termination of his employment after he has rendered continuous service of not less than five years. Employee within the meaning of the aforesaid Act means any person employed on wages in any establishment, factory, mine, oil filed plantation, port, railway company or shop to do any skilled, semi-skilled, or unskilled, manual supervisory, technical or Clerical work, whether the terms of such employment are express or implied. The entitlement of the petitioners to the payment of gratuity has not been disputed before us. Regulation 13.1 of the Punjab University Callendar Volume I, Chapter VIII B dealing with the affiliated Colleges specifically provides :-

"13.1(i) In addition to th