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2024 Supreme(Telangana) 253

IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
SUREPALLI NANDA, J.
Electronics Corporation of India Limited, Hyderabad – Petitioner
Versus
The Appellate Authority under Payment of Gratuity Act, 1972 and Deputy Chief Labour Commissioner and Others – Respondents
W.P. Nos. 15706, 15840, 15843 of 2018
Decided On : 03-06-2024

Advocates Appeared:
For the Petitioner: G. Vidya Sagar.
For the Respondent: P.V. Krishnaiah.

The Office Memorandum dated 26.11.2008 is advisory and does not impose a binding obligation on public sector undertakings to pay enhanced gratuity prior to the amendment of the Gratuity Act.

Headnote:(A) Payment of Gratuity Act, 1972 - Section 4 - Writ of Certiorari - The petitioner, a Central Public Sector undertaking, challenged the orders of the Appellate Authority and Controlling Authority regarding the payment of gratuity exceeding Rs.3.5 lakhs, claiming entitlement to Rs.10 lakhs from 01.01.2007 based on an Office Memorandum. The authorities ruled in favor of the respondents, leading to the writ petition. (Paras 2, 5, 6, 8, 34)

(B) Legal Interpretation - The court examined whether the Office Memorandum dated 26.11.2008 is mandatory or advisory. It concluded that the memorandum is advisory and does not impose a binding obligation on the petitioner to pay enhanced gratuity prior to the amendment of the Gratuity Act. (Paras 9, 10, 28)

(C) Discrimination - The court noted that the petitioner had previously paid enhanced gratuity to other employees who retired before the amendment, which raised concerns of discrimination against the respondents. (Paras 20, 36)

(D)

Findings of Court:
The court found that the respondents were entitled to the enhanced gratuity as per the Office Memorandum and previous rulings, emphasizing that gratuity is a right of the employee, not a bounty. (Paras 19, 34) (E)

Result: Writ petitions dismissed, confirming the entitlement of respondents to enhanced gratuity. (Paras 34, 35)

ORDER :

1. Heard learned Senior Designate Counsel Mr.G.Vidya Sagar, representing the learned counsel appearing on behalf of the petitioner on record and Mr.P.V.Krishnaiah, learned counsel appearing on behalf the respondents.

PRAYER:

2. The petitioner approached the court seeking prayer as under:

    “…to issue an order, direction or Writ more particularly one in the nature of Writ of Certiorari or any other appropriate writ after calling for the records quash the order passed in P.G. Appeal Case Nos.9 of 2018 – 304 of 2018, dated 16.04.2018 by the Appellate Authority under Payment of Gratuity Act, 1972 and Deputy Chief Labour Commissioner (C), Vidyanagar, Hyderabad, including the order of the Controlling Authority under P.G.Act, 1972 and Assistant Labour Commissioner (Central), ATI Campus, Vidyanagar, Hyderabad passed in P.G. Case No. 48/42/2014-E3/E2 and batch, dated 10.11.2017 and pass…”

3. The petitioner approached the court seeking prayer as under:

    “…to issue an order direction or Writ more particularly one in the nature of Writ of Certiorari or any other appropriate writ after calling for the records quash the order passed in P.G. Appeal Nos.3 of 2018, 4 of 2018, and 5 of 2018, dated 16.04.2018 by the Appellate Authority under Payment of Gratuity Act 1972 and Deputy Chief Labour Commissioner (C) Shivam Road, ATI Campus, Vidyanagar, Hyderabad including the order of the Controlling Authority under P.G. Act, 1972 and Assistant Labour Commissioner (Central) ATI Campus, Vidyanagar, Hyderabad passed in P.G. Case No. 48/39/2014-E3/E2 and batch, dated 10.11.2017 and pass…”

4. The petitioner approached the court seeking prayer as under:

    “…to issue an order direction or Writ more particularly one in the nature of Writ of Certiorari or any other appropriate writ after calling for the records quash the order passed in P.G. Appeal Nos.6 of 2018, 7 of 2018 and 8 of 2018, dated 16.04.2018 by the Appellate Authority under Payment of Gratuity Act 1972 and Deputy Chief Labour Commissioner (C) Shivam Road, ATI Campus, Vidyanagar, Hyderabad including the order of the Controlling Authority under P.G. Act 1972 and Assistant Labour Commissioner (Central), ATI Campus Vidyanagar Hyderabad passed in P.G. Case No. 48/95/2015-E3/E2 and batch, dated 10.11.2017 and pass…”

5. PERUSED THE RECORD:

    (A) This Court vide its interim orders dated 01.05.2018 in I.A.No. 1 of 2018 in W.P.No. 15706 of 2018 passed orders observing as under:

    “The petitioner is Electronics Corporation of India Limited, Hyderabad, is a Central Public Sector undertaking. Respondents retired from the petitioner- Corporation on attaining the age of superannuation on various dates prior to May, 2010. Respondents filed applications before the 2nd respondent for a direction for payment of difference of gratuity amount on the ground that they are entitled to gratuity with the ceiling limit of Rs.1O.00 lacs w.e.f. 01.01.2007 instead of Rs.3.50 lacs.

    The 2nd respondent-Controlling Authority under the Payment of Gratuity Act, 1972, allowed the claim of the respondents on the premise that they are entitled to gratuity as they are governed by the ECIL Gratuity Trust Rules including the ceiling limit as applicable to the ECIL employees. That the petitioner-EClL has already paid the gratuity at the ceiling limit of Rs.3.50 lacs, the 2nd respondent directed to pay the remaining amounts of enhanced rates of gratuity with interest at 10% as prescribed by the Government of India notification No. S.O.874 (4), dated 01-10 -1984. Aggrieved by the same, writ petition was preferred by the petitioner being WP No. 1253 of 2O18 and this Court disposed of the same with an observation to avail the remedy of filing appeal to the 1st respondent. It is stated that the petitioner-EClL filed appeal before the 1st respondent-appellate Authority and the 1st respondent, by the impugned order dated 16-04-2018 confirmed the order of the 2nd respondent-Controlling Authority. Hence, the writ petition.

    Sri P. Vidya Sagar, learned senior cou

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