2025 Supreme(Online)(Ker) 15453
IN THE HIGH COURT OF KERALA AT ERNAKULAM
AMIT RAWAL, K. V. Jayakumar, JJ
IFB INDUSTRIES LTD. – Appellant
Versus
GINU JOSE – Respondent
WA 661/2025
For the Appellants/Petitioners: PRAKASH M.P.
For the Respondents: T.B.REMANI-R1, O.M. SHALEENA (DSGI)
Resignation does not negate entitlement to gratuity under the Payment of Gratuity Act, 1972.
Headnote:The court considered the provisions of the Payment of Gratuity Act, 1972 concerning resignation entitling employees to gratuity, affirming the lower courts' findings in favor of the respondent. The case involved an appeal against a decision on gratuity entitlement after resignation not being honored by the management. The dismissal was predicated on the claimant’s premature resignation, but the court concluded that resignation does not negate gratuity entitlement. Accordingly, the appeal was dismissed as there was no legal basis to reverse the earlier orders.
| Table of Content |
|---|
| 1. entitlement to gratuity despite resignation. (Para 1 , 2 , 3 , 4 , 5) |
| 2. arguments against employee's entitlement. (Para 6 , 7) |
| 3. court's analysis of the employment agreement. (Para 8 , 9 , 10) |
| 4. final determination of gratuity eligibility. (Para 11) |
For the reasons stated in the affidavit accompanying C.M.Appln No.1 of 2025, delay of 95 days in filing the appeal is condoned.
2. Appellant/petitioner had been un-successful in challenging the order of the controlling authority dated 20.06.2022, Ext.P9, and the appellate authority dated 26.06.2023, Ext.P11, whereby the claim of the respondent No.1 for payment of gratuity has been decided in his favour.
3. Facts in brief for adjudication of the controversy is as follows:
Respondent No.1 vide Ext.P1, was employed in the management of the appellant on 18.06.2007. The terms and conditions of the appointment contained various clauses, including the clause of serving advance notice of thirty(30) days in case of resignation or otherwise. Vide e-mail dated 12.04.2014, Ext.P2, respondent No.1 tendered his resignation as Senior Accounts Executive from the management of the appellant/petitioner from that day with a condition that he would be ready to serve the entire notice period as per the employment contract, ie., thirty days, which would have expired on 11.07.2014. The management, in response to the aforementioned e-mail, vide communication dated 22.04.2014, Ext.P3, replied that they were permitting to adjust any sort of leave after resignation, after serving the full notice period and the value accrued of the one will be paid at the time of settlement of final salary. Vide communication dated 30.05.2014 requested the management to release the salary for the month of May, 2014 on account of the fact that he did not have any other source of income, and another e-mail was also sent that he would not be able to continue after 07.06.2014, with a request that in the absence of fulfillment of three months notice period, relieving letter would be issued after compensating the remaining month’s salary. The aforementioned e-mail was replied by the management vide communication dated 30.05.2014, advising the respondent No.1 to serve the full notice period as per the admitted terms and conditions. On 04.06.2014, an e-mail was sent by the respondent No.1 that he had handed over the entire responsibility on 03.06.2014 itself and there was no pending issue regarding his work.
4. After expiry of almost three years, had submitted an application under the Payment of Gratuity Act, 1972 , claiming the gratuity on account of having rendered six years and eleven months of service of Rs.57,246/-. The aforementioned claim was objected to by the management by filing a reply, Ext.P8, much less the objection of limitation was also taken, though the basic salary of the respondent No.1 was Rs.16,100/-. The controlling authority vide order Ext.P9, allowed the application by taking note of the provisions of Section 7(2), 7(3) as well as the other provisions of the , that resignation is also a ground for entitlement of gratuity. An appeal preferred thereon has been dismissed.
5. The learned Single Judge, noticing the contentions, dismissed the writ petition on the ground that the management had agreed to process the leave encashment of the respondent No.1. However, the said findings were agitated in Review Petition No.1306 of 2024, which has been dismissed vide order dated 04.03.2025 noticing that the respondent No.1 had agreed to settle his loans and unexpired part of the notice period as per his offer letter, with bank interest or company norms by considering the last working day as 07.06.2014, by cash, demand draft, or cheque against the full and final settlement of the balance amount. It is in that background that both the judgment in the writ petition dated 12.11.2024 as well as the order in the Review Petition dated
04.03.2025 are under challenge.
6. The learned counsel appearing on behalf