Honble Prakash Krishna, J.—Raising a somewhat interesting question the present writ petition has been filed. The question involved in the present petition is regarding the applicability of Payment of Gratuity Act, 1972 (hereinafter referred to as the Act) and the U.P. Nagar Mahapalika Non-Centralized Services Retirement Benefit Regulations, 1984 (hereinafter referred to as the Regulation) with respect to employees of Nagar Mahapalika Non Centralized Services.

2. The facts of the case are not much in dispute. Ram Saran Ruhela, the respondent No. 3, who was working with the petitioner was placed under suspension, charge-sheeted and his services were terminated vide order dated 8th of January, 1991. He was dismissed by the order dated 8th December, 1995. The said order was modified by the appellate authority and dismissal was substituted by an adverse entry and stoppage of two increments. The matter came up before this Court in two writ petitions being writ petition Nos. 1998 of 1996 and 7140 of 1996. Both the writ petitions were clubbed together and were decided by a common judgment dated 15th of October, 2003. It was held by this Court that the contesting respondent herein is entitled for subsistence allowance and in addition thereto 30 per cent of back wages from the date of suspension to the date of reinstatement. The amounts were directed to be paid within three months. The necessary payments were made to the respondent No. 3 which is evident from the receipt dated 27th February, 2004. In the meantime, the respondent retired and he filed an application before the Controlling Authority under the Payment of Gratuity Act, 1972 claiming gratuity for a total period of service i.e. 40 years three months and 11 days. The said proceeding was contested on the ground that the petitioner is not entitled for any gratuity as he was removed from the services by the order dated 18th February, 1995. It was further stated that in view of the Rule 10, the respondent No. 3 is not entitled either for gratuity or family pension. The Controlling Authority by the order dated 7th October, 2005 directed the petitioner to pay a sum of Rs. 61,347/- as gratuity with interest etc. as per the Gratuity Act. The said amount has also been paid. However, an appeal being appeal No. 138 of 2005 was filed before the appellate authority under the Act.

3. The Appellate Authority, U.P., under the Payment of Gratuity Act by the impugned order dated 3rd of May, 2006 has allowed the appeal and directed that the gratuity amount should be calculated as per the provisions of the Act instead of Regulation. Challenging the said order the present writ petition has been filed.

4. Shri R.K. Awasthi, the learned counsel for the petitioner submits that the provisions of the Act are not attracted. The Appellate Authority committed illegality in ordering the calculation of the gratuity amount as per the Regulation. He submits that the Regulations having been framed under the provisions of U.P. Municipalities Act will be applicable to the facts of the present case. Shri Vishnu Sahai, learned counsel for the respondent No. 3, on the other hand, submits that the provisions of the Act will be applicable and has placed reliance upon a judgment of the Apex Court in Municipal Corporation Delhi v. Dharam Prakash, AIR 1999 SC 293.

5. A pristine question of law is involved as to whether the provisions of the Regulation will be attracted as submitted by the learned counsel for the petitioner or the gratuity shall be payable as per the provisions of the Gratuity Act.

6. Considered the respective submissions of learned counsel for the parties.

7. The Act applies to every factory, mines, oilfields, plantations, ports, railway, companies, shops or other establishments or classes of establishments in which ten or more persons are employed, or were employed, on any date of the preceding twelve months, as the Central Government may, by notification, specify in this behalf, as provided