JUDGMENT

Dr. Yogendra Kumar Srivastava, J.

1. Heard Sri Dharmendra Vaish, learned counsel for the petitioner, Ms. Jyotsana Srivastava, learned counsel appearing for respondent Nos. 1, 2 and 3 and Sri Sandeep Kumar, learned counsel for respondent No. 4.

2. The present petition has been filed seeking a direction to the Appellate Authority constituted under the Payment of Gratuity Act, 1972 (the P.G. Act, 1972) to accept the bank guarantee furnished by the petitioner-bank in lieu of the deposit to be made as a pre-condition for filing of an appeal under Section 7(7) of the P.G. Act, 1972.

3. Briefly stated the facts of the case are that upon an application filed by the fourth respondent under sub-rule (1) of Rule 10 of the Payment of Gratuity (Central) Rules, 1972 (the Rules, 1972) alleging that he had not been paid due amount of gratuity by the Prathama Bank, Head Office, Ram Gahga Vihar, M.D.A., Moradabad (petitioner herein) an order dated 12.3.2019 was passed by the Controlling Authority under the P.G. Act, 1972/Assistant Labour Commissioner (Central), Bareilly allowing the application and issuing a direction to the Prathama Bank to pay the balance amount of gratuity together with interest to the fourth respondent.

4. It is submitted that against the aforesaid order passed by the Controlling Authority an appeal under Section 7(7) of the P.G. Act, 1972 was preferred before the second respondent with a request for accepting bank guarantee in lieu of deposit as required under sub-section (7) of Section 7. It is further submitted that the fourth respondent vide its communication dated 2.8.2019 has informed the petitioner-bank that in terms of Section 7(7) of the P.G. Act, 1972 bank guarantee cannot be permitted as there is no provision for the same and the petitioner has been advised to deposit the amount in the shape of demand draft within the specified period so that the appeal could be entertained.

5. Contention of the learned counsel for the petitioner is that the petitioner is a rural bank and is facing financial crisis and in view of the same the condition of deposit of the amount would further aggravate its financial hardship and as such permission ought to have been granted for furnishing of bank guarantee in lieu of the requirement to make the pre-deposit.

6. The issue which thus arises in the present petition is as to whether the condition of pre-deposit under sub-section (7) of Section 7 of the P.G. Act, 1972 is mandatory, and as to whether bank guarantee can be directed to be furnished in lieu of such pre-deposit.

7. In order to appreciate the contention which is sought to be raised by the petitioner the provision of filing of an appeal under sub-section (7) of Section 7 of the P.G. Act, 1972 may be referred to. For ease of reference Section 7 of the P.G. Act, 1972 is being extracted below:

"7. Determination of the amount of Gratuity.--(1) A person who is eligible for payment of gratuity under this Act or any person authorised, in writing, to act on his behalf shall send a written application to the employer, within such time and in such form, as may be prescribed, for payment of such gratuity.

(2) As soon as gratuity becomes payable, the employer shall, whether an application referred to in sub-section (1) has been made or not, determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the controlling authority specifying the amount of gratuity so determined.

(3) The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable to the person to whom the gratuity is payable.

(3-A) If the amount of gratuity payable under sub-section (3) is not paid by the employer within the period specified in sub-section (3) the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government from time to time for repaym