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2023 Supreme(All) 2392

IN THE HIGH COURT OF ALLAHABAD
SARAL SRIVASTAVA, J.
U.P. State Road Transport Corporation Gorakhpur - Petitioner
Versus
Sri Sujayat Ali and Others - Respondents
WRIT C NO. 37690 OF 2022.
Decided On : 31-01-2023

Advocates appeared:
For the Petitioner: Sunil Kumar Misra.
For the Respondent: C.S.C., Shobhna Srivastava, Sudhanshu Narain.

Headnote:(A) Payment of Gratuity Act, 1972 - Section 4(2) - Gratuity entitlement for daily wage workers - Dismissal of writ petitions challenging the authority's order for gratuity payment for employment period as daily wager. Court upholds the legality of granting gratuity under the Act without exclusion of daily wager service. (Paras 8-10)

(B) Legal interpretation - Section 4(2) does not preclude gratuity for daily wage employment; entitlement applies to all periods of service rendered. Previous court judgment referenced. (Paras 6, 11)

Facts of the case:
Petitioner challenges order granting respondent gratuity for service as daily wager from 06.01.1977 to 02.03.1983, arguing unentitlement based on employment type. Respondents contend entitlement based on clear statute language.

Findings of Court:
No illegality found in the authority’s order regarding gratuity payment for the respondent’s service period.

Issues: Main issue revolves around whether service duration as a daily wager affects gratuity entitlement under the Act.

Ratio Decidendi: Court states explicit wording in Section 4(2) supports gratuity payment, rejecting arguments against entitlement for daily wage service.

Result: Writ petitions dismissed with no order as to costs.

Table of Content
1. common question across writ petitions (Para 1 , 2 , 3)
2. eligibility for gratuity payment (Para 4 , 5)
3. interpretation of section 4(2) of act (Para 6 , 8)
4. entitlement to gratuity including temporary service (Para 9 , 10 , 11)
5. dismissal of writ petitions (Para 12 , 13)

JUDGMENT

Saral Srivastava, J.

Heard Amit Dwivedi, Advocate holding brief of Sri Sunil Kumar Misra, learned counsel for the petitioner and learned counsel for the respondents.

2. Since, these three writ petitions involve common question, therefore, they are being decided by this common judgement.

3. For convenience, the facts are being delineated from Writ C- No. 37690 of 2022.

4. The petitioner petitioner by means of the present writ petition has assailed the order dated 22.12.2020 passed by the Controlling Authority, Payment of Gratuity Act, 1972/Assistant Labour Commissioner, U.P. Gorakhpur (hereinafter referred to as 'Prescribed Authority') whereby Prescribed Authority has awarded gratuity to the respondent no.1 for the period 06.01.1977 to 02.03.1983 i.e. the period during which respondent no.1 was employed as daily wager.

5. Challenging the aforesaid order learned counsel for the petitioner has contended that respondent no.1 is not entitled to any gratuity for the period of service rendered by him as daily wager. Accordingly, it is submitted that Prescribed Authority has acted illegally and without jurisdiction in passing the impugned order.

6. Per contra, learned counsel for the respondents has contended that section 4(2) of Payment of Gratuity Act, 1972 (hereinafter referred to as 'Act, 1972') which provides for payment of gratuity does not envisage that the period rendered as daily wager during service shall be excluded for the purpose of computation of gratuity. It is further submitted that Section 4 (2) of the Act, 1972 is unambiguous and clear and provides that employer shall pay gratuity to an employee at the rate of 15 days wages. In support of his aforesaid contention, he has placed reliance upon the judgement of this Court in the case of Bali Ram Yadav v. State of U.P. and Others passed in Writ-A No.56926 of 2017.

7. I have considered the rival submission of the parties and perused the record.

8. section 4(2) of the Payment of Gratuity Act, 1972 provides for payment of gratuity. Section 4 (2) of the Act, 1972 relevant in the context of the present case is reproduced herein below:-

    "4 Payment of gratuity. -

    (1)...

    (2). For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days' wages based on the rate of wages last drawn by the employee concerned:

    Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account:

    Provided further that in the case of [an employee who is employed in a seasonal establishment and who is not so employed throughout the year], the employer shall pay the gratuity at the rate of seven days' wages for each season.

    [Explanation. -In the case of a monthly rated employee, the fifteen days' wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen.]"

9. A reading of Section 4 (2) of the Act, 1972 does not reveals that employer shall not be liable to pay gratuity to the employee for the period of service rendered by him as daily wager. Section 4 (2) of the Act, 1972 clearly provides that employer shall pay gratuity to an employee at the rate of fifteen days' wages based on the rate of wages last drawn by the employee concerned, for every completed year of service or part thereof in excess of six months.

10. So reading of Section 4 (2) of the Act, 1972 makes it manifestly clear that employer is en

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