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2024 Supreme(UK) 390

IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL
Manoj Kumar Tiwari, Pankaj Purohit, JJ.
Kamal Nayan Nautiyal - Petitioner
Versus
State of Uttarakhand & others - Respondents
Writ Petition (S/B) No. 664 of 2022, Writ Petition (S/B) No. 667 of 2022, Writ Petition (S/S) No. 1814 of 2022, Writ Petition (S/S) No. 1966 of 2022, Writ Petition (S/S) No. 2016 of 2022, Writ Petition (S/S) No. 2020 of 2022, Writ Petition (S/S) No. 2175 of 2022, Writ Petition (S/S) No. 2176 of 2022, Writ Petition (S/S) No. 2177 of 2022, Writ Petition (S/S) No. 2178 of 2022, Writ Petition (S/S) No. 2255 of 2022, Writ Petition (S/S) No. 2256 of 2022, Writ Petition (S/B) No. 342 of 2023, Writ Petition (S/B) No. 403 of 2023, Writ Petition (S/B) No. 404 of 2023, Writ Petition (S/B) No. 405 of 2023, Writ Petition (S/B) No. 406 of 2023, Writ Petition (S/B) No. 407 of 2023, Writ Petition (S/B) No. 408 of 2023, Writ Petition (S/B) No. 409 of 2023, Writ Petition (S/B) No. 410 of 2023, Writ Petition (S/B) No. 454 of 2023, Writ Petition (S/S) No. 1266 of 2023, Writ Petition (S/S) No. 1599 of 2023, Writ Petition (S/S) No. 1600 of 2023, Writ Petition (S/S) No. 1601 of 2023, Writ Petition (S/S) No. 1602 of 2023, Writ Petition (S/S) No. 1603 of 2023, Writ Petition (S/S) No. 1605 of 2023, Writ Petition (S/S) No. 1606 of 2023, Writ Petition (S/S) No. 1609 of 2023, Writ Petition (S/S) No. 1610 of 2023, Writ Petition (S/S) No. 1611 of 2023, Writ Petition (S/S) No. 1615 of 2023, Writ Petition (S/S) No. 1620 of 2023, Writ Petition (S/S) No. 1621 of 2023, Writ Petition (S/S) No. 1917 of 2023, Writ Petition (S/S) No. 1919 of 2023, Writ Petition (S/S) No. 1920 of 2023, Writ Petition (S/S) No. 1921 of 2023, Writ Petition (S/S) No. 1922 of 2023, Writ Petition (S/S) No. 1927 of 2023,
Decided On : 12-03-2024

Advocates:
Advocate Appeared:
For the Petitioner: Mrs. Pushpa Joshi, learned Senior Counsel assisted by Ms. Chetna Latwal, learned counsel and Ms. Nipushmola Joshi, learned counsel, Mr. Mahendra Singh Rawat, learned counsel
For the Respondent: Mr. Devendra Singh Bora, learned Standing Counsel, Mr. Sandeep Kothari, learned counsel

IMPORTANT POINT
The authority of a Board of Directors in determining employee benefits is upheld, and financial constraints can justify delays in payment of dues.

Headnote:

Mandamus - Retiral Benefits - Gratuity Act, 1972 - Sections 7(3A) - The court interpreted the provisions of the Gratuity Act regarding delayed payments and the authority of the Board of Directors in determining pay scales, ultimately denying the petitioners' claims for arrears based on financial constraints.

Fact of the Case:

The petitioner, a retired employee of a government company, sought a writ for the release of outstanding retiral benefits, including leave encashment and arrears from the 6th and 7th Pay Commissions, which had not been paid due to the company's financial issues.

Finding of the Court:

The court found that the Board of Directors of the company had made a decision regarding the payment of dues based on financial constraints, which was not challenged by the petitioners, thus limiting the court's ability to issue a mandamus for payment.

Issues: Whether the petitioners are entitled to arrears of the 6th and 7th Pay Commission and interest on delayed gratuity payments despite the Board's decision based on financial conditions.

Ratio Decidendi: The court held that the decision of the Board of Directors regarding pay scales and arrears is binding unless challenged, and the financial condition of the company justifies the delay in payment.

Result: Writ petitions disposed of; no direction for payment of arrears issued.

JUDGMENT :

Manoj Kumar Tiwari, J.

Since common questions of law and fact are involved in these writ petitions, therefore, they are being heard and decided together by this common order. However, for the sake of brevity, facts of Writ Petition (S/B) No. 664 of 2022 alone are being considered.

2. Kamal Nayan Nautiyal (petitioner) has filed this writ petition seeking the following reliefs:-

    “(i) To issue a writ order or direction in the nature of Mandamus commanding the Respondents to forthwith release the outstanding retiral benefits i.e. Leave Encashment, arrears of 6th pay Commission and arrears of 7th Pay Commission in favour of the petitioner.

(ii) to issue a writ order or direction in the nature of mandamus commanding the Respondents to forthwith release the interest on the delayed payment of Gratuity as per section 7 (3A) of Gratuity Act, 1972 from the date on which the gratuity becomes payable to the date on which it is paid.”

3. Petitioner was an employee of a Government Company, namely Garhwal Mandal Vikas Nigam Limited (hereinafter referred to as ‘GMVN’). He retired from the post of Assistant General Manager (Tourism) on 31.05.2021. According to petitioner, he has not been paid the amount of leave encashment, arrears of 6th & 7th Pay Commission and interest on delayed payment of gratuity therefore, he has sought a direction to the authorities to forthwith release the outstanding dues.

4. An affidavit has been filed by Mr. Satpal Singh Gandhi, Accounts Officer, GMVN on 29.02.2024, in which it is stated that petitioners in all the writ petitions, except four writ petitions mentioned therein, have been paid the admitted retiral dues. Paragraph no. 4 of the said affidavit is extracted below:-

    “4. That a perusal of the aforesaid tables so prepared makes it absolutely clear that except in writ petition No. WPSB/408/2023, WPSB/454/2023, WPSS/1600/2023 & WPSS/1919/2023, all other petitioners have been paid the admitted retiral dues are liable to be paid and which has been paid to all other similarly situated employees to the Grahwal Mandal Vikas Nigam Ltd.”

5. Relevant information regarding retiral dues, which have been paid and also the dues, which remain to be paid to some of the petitioners is given in tabular form in Annexure-1 to the aforesaid affidavit filed by Accounts Officer. Perusal of the said affidavit reveals that leave encashment and arrears of leave encashment is yet to be paid to Mr. Susheel Chandra (petitioner in WPSS No. 408 of 2023); arrear of ACP is yet to be paid to Mr. Jitendra Singh Negi (Petitioner in WPSB No. 454 of 2023); arrear of gratuity is sanctioned to Mr. Vikram Singh Panwar (petitioner in WPSS No. 1600 of 2023) and payment is under process and leave encashment is also yet to be paid to him. Similarly, Mr. Kuldeep Singh Rauthan (petitioner in WPSS No. 1602 of 2023) and Mr. Vijendra Pal Singh (petitioner in WPSS No. 1620 of 2023) have been sanctioned leave encashment and arrears of leave encashment and payment thereof is under process; Smt. Sushila Chauhan (petitioner in WPSS No. 1919 of 2023) is yet to be paid arrear of ACP; Ms. Saroj Kukreti (petitioner in WPSS No. 1920 of 2023) has been sanctioned leave encashment & arrears of leave encashment and payment thereof is under process, and the pending dues of all other petitioners have been cleared.

6. Petitioners have staked claim for arrears of salary, which accrued to them on account of 6th & 7th pay revision. According to them, benefit of 6th pay revision, with arrears, was given to State employees w.e.f. 01.01.2006, therefore, they are also entitled to same benefit w.e.f. 01.01.2006. Petitioners have also claimed benefit of 7th pay revision w.e.f. 01.01.2016 at par with State employees, which was given to them w.e.f. 01.01.2017.

7. It is contended on behalf of the petitioners that benefit of 6th pay revision was given to officers/employees of GMVN, only w.e.f. 01.08.2009, similarly, benefit of 7th pay revision was given to them w.e.f. 01.01.2017, which

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