IN THE HIGH COURT OF ALLAHABAD
Chandra Kumar Rai, J.
Baroda Uttar Pradesh Bank – Petitioner
Versus
Komal Ram & Others - Respondents
WRIT – C No. -20839 of 2024 WRIT -C No. -20841 of 2024
Decided On : 09-09-2024
(A) Payment of Gratuity Act, 1972 - Sections 4(6) and 7 - Gratuity entitlement - Dismissal of employee for misconduct - The court held that gratuity is a statutory right and cannot be denied without proper legal grounds. The dismissal order did not justify forfeiture of gratuity as per the Act. (Paras 12, 18, 19)
(B) Judicial Review - The court emphasized that the controlling authority's decision regarding gratuity claims must be respected unless there is clear illegality or arbitrariness. (Paras 17, 22)
Facts of the case:
The petitioner bank challenged the orders of the controlling authority and appellate authority regarding the payment of gratuity to dismissed employees, asserting that the dismissal precluded gratuity claims.
Findings of Court:
The court found no merit in the bank's claims and upheld the authorities' decisions, affirming the employees' rights to gratuity.
Issues: The main issues were the entitlement to gratuity post-dismissal and the applicability of the Payment of Gratuity Act in the context of internal bank regulations.
Ratio Decidendi: The court ruled that the Payment of Gratuity Act provides a clear framework for gratuity claims, and dismissal does not automatically negate entitlement unless specific conditions are met.
Result: Writ petitions dismissed.
JUDGMENT :
Chandra Kumar Rai, J.
1. Heard Mr. Gyan Prakash Srivastava, learned counsel for the petitioner, Mr. Shubham Kumar, learned counsel for respondent nos. 1/1 to 1/5, Mr. Anant Kumar Tiwari, learned counsel for respondent nos. 2 & 3 in the leading petition and Mr. Gyan Prakash Srivastava, learned counsel for the petitioner, Mr. Sri Narayan Mishra, learned counsel for respondent no.1, Mr. Anant Kumar Tiwari, learned counsel for respondent nos. 2 & 3 in the connected petition, i.e. Writ C No.20841 of 2024.
2. With the consent of learned counsel for the parties, both the aforesaid writ petitions are being heard finally without inviting counter affidavits in the matter.
3. Since common issues are involved in both the writ petitions, same are being disposed of by a common order. The facts stated in Writ C No.20839 of 2024 shall be treated as a leading petition.
4. Brief facts of the case stated in the leading petition are that erstwhile Purvanchal Bank, Kashi Gomti Samyut Gramin Bank are now amalgamated vide Government Notification No.3837 dated 26.11.2019 and assigned the new name “Baroda Uttar Pradesh Bank”. The Baroda Uttar Pradesh Bank came into existence w.e.f. 1.4.2020. The employees who were working under erstwhile Kashi Gomti Samyut Gramin Bank, now Baroda Uttar Pradesh Bank are governed by Baroda Uttar Pradesh Bank (Officer and Employees) Service Regulations, 2020. In respect to payment of gratuity, there exists Regulation No.72 for payment of gratuity in the Purvanchal Gramin Bank (Officers & Employees), Service Regulations, 2010, now Baroda Uttar Pradesh Bank (Officers & Employees) Service Regulations, 2020. Under Chapter 4 of Regulation, 2010, there exist Regulations 16 to 51 which contains provision pertaining to conduct, discipline and appeals. Respondent no.1 joined in Kashi Gomti Samyut Gramin Bank and he was holding the post of Officer JMGS-1 at Nariaon Branch. At the time of aforementioned posting, in respect to certain financial irregularity, a charge-sheet dated 21.1.2020 was issued to respondent no.1. The aforesaid disciplinary proceedings, on the basis of the aforementioned charge-sheet, was concluded and vide order dated 7.9.2012, respondent no.1 was dismissed from services of the bank with immediate effect. Against the order dated 7.9.2012, an appeal was filed by respondent no.1 which was dismissed by the appellate authority on 1.2.2013. Respondent no.1 filed re-appeal against the order dated 7.9.2012 which was also dismissed on 18.11.2013 on the ground that there is no provision of review under Service Regulation, 2010. Respondent no.1 challenged the orders dated 7.9.2012 and 1.2.2013 before this Court by wary of Writ A No.22630 of 2013 which was dismissed by this Court vide order dated 1.5.2013. Respondent no.1 filed an application on 22.2.2018 before the Assistant Labour Commissioner (Central)/Controlling Authority under the Payment of Gratuity Act, 1972 (hereinafter referred to as “the Act”) which was registered as Case No.A-48(9) of 2018, claiming gratuity for services rendered by him in bank for 32 years 11 months and 24 days, i.e. from 13.10.1979 to 7.9.2012. The notice was issued by the Controlling Authority to the bank, accordingly, the bank submitted his reply before the Controlling Authority on 12.10.2018. The Controlling Authority vide order dated 16/19.8.2021 has held that respondent no.1 is entitled for gratuity amount of Rs.4,68,213/- along with 7 % simple interest, amounting to Rs.2,89,511/-, total amounting to Rs.7,57,724/-. Against the order of the Controlling Authority dated 16/19.8.2021, the petitioner-bank filed an appeal under sub-section 7 of Section 7 of the Act before the Deputy Chief Labour Commissioner (Central)/The Appellate Authority by depositing Rs.7,57,724/- vide D.D. No.371829 dated 29.11.2021. The aforementioned appeal was registered as Case No.K-36(69)/2021 C-1. The appellate authority vide order dated 27.3.2024 dismissed the appeal filed by the petitioner, hence, this wr
Gratuity is a statutory right under the Payment of Gratuity Act, 1972, and cannot be forfeited without legal justification, even after dismissal for misconduct.
The Payment of Gratuity Act, 1972, is a beneficial welfare legislation that overrides internal service regulations. Forfeiture of gratuity is strictly limited to the specific conditions prescribed un....
Proper notice, quantification, and opportunity to be heard are mandatory for forfeiting gratuity under the Payment of Gratuity Act, 1972; failure to comply invalidates the forfeiture.
Employer cannot withhold gratuity for unauthorized retention of quarters post-retirement; statutory interest of 10% applies for delayed payment.
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