BOMBAY HIGH COURT
N.A. Britto, J.
State Bank of India —Petitioner
versus
Laxmikant Vithal and Ors. —Respondents
Writ Petition No. 248 of 2009
Decided on 16.6.2010

Headnote:Payment of Gratuity Act, 1972—Sections 2(s), 3, 4—Gratuity (Central) Rules, 1972—Rule 10, Proviso—Limitation Act, 1963—Section 5—Deficit in payment of gratuity—Delay in filing application—Condonation of—Sufficient cause—Respondent was working as a Senior Assistant with petitioner bank until his voluntary retirement on 31.3.2001—He was paid gratuity in the sum of Rs. 3,03,007 which was received by him without protest—On or about 9.5.2006, i.e. after a lapse of more than five years, employee filed an application before Labour Commissioner claiming that there was deficit in payment of gratuity which arose on account of last drawn wage of the employee being computed at Rs. 16,412 instead of Rs. 17,556—Respondent employee was entitled to special compensation allowance of Rs. 550 and fixed personal allowance of Rs. 615—Whether controlling Authority was justified in condoning delay of about five years—Held, No—Whether there was any deficit in payment of gratuity—No.

       Held: Whether under Section 5 of the Limitation Act or for that matter under the proviso below Rule 10 of the Gratuity (Central) Rules, 1972 an application could be entertained after the expiry of the prescribed period of 90 days only on sufficient cause being shown, after the expiry of the specified period. In the case at hand except for the said casual and bare statement made by the employee there was no explanation whatsoever to condone the said delay of over five years inasmuch as the employee had not even set out as to when the said judgment had come to his notice. An Appellate Authority should be slow in disturbing the exercise of jurisdiction by the Controlling Authority only in case the Controlling Authority had assigned some reasons to condone the delay and this was a case where there were none. Condonation of delay cannot be obtained for mere asking. There has to be sufficient cause to condone the delay though the expression “sufficient cause” is liberally construed and is elastic enough to enable the Court to apply the law in a meaningful manner. There can be no dispute that while condoning the delay what matters is not the length of the period but the acceptability of the explanation offered to condone the delay. The Courts should not lose sight of the fact that by not taking steps within the time prescribed a valuable right accrues to the other party which cannot be lightly defeated by condoning the delay in a routine manner. Sufficient cause has to be considered with pragmatism and with justice oriented approach but any cause whatsoever cannot be construed as a sufficient cause and it is necessary for the Courts or the authorities to apply their mind to the cause shown and to satisfy themselves and to find out whether the cause shown is sufficient or not. Although the expression “sufficient cause” is liberally construed it does not mean that the Courts should readily accept whatever the party has stated to explain his default. If the Courts or authority accept anything and everything stated by a party, then such a party will have the last laugh at the cost of his adversary Courts and authorities are required to scrutinize the cause shown and would be justified in considering the merits of the evidence led to establish the same. Elasticity of the expression “sufficient cause” does not mean that it can be stretched to a breaking point. (Para 12)

       Therefore, the conclusions arrived at by both the authorities below in condoning the delay has to be considered as perverse and on this count alone the application of the employee to the Controlling Authority dated 17.5.2006 ought to have been dismissed. (Para 14)

       The petitioners have included a component of Rs.380 out of Rs.615 of the fixed personal pay in computing the gratuity payable to the employee and it has been submitted by Shri Sonak, the learned counsel on behalf of the petitioners that that inclusion has been done in the light of the provision of sub-section (5) of Section 4 of the Act which gives an employee a right to receive better terms of gratuity under any award, agreement or contract wit the employer. (Para 19)

       In view of the above discussion, the petitioners are bound to succeed on both the counts, firstly because the application before the Controlling Authority was filed with much delay without any satisfactory explanation and, secondly both the allowances, namely fixed personal allowance/pay as well as special compensatory allowance had to be included within the expression “other allowances”, as defined under Section 2(s) of the Act, and, therefore would not form part of wages for computing gratuity except to the component of fixed personal pay which was agreed to be included by virtue of the bipartite settlement/award. (Para 22)

       Result: Petition allowed.