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2026 Supreme(Online)(Ker) 2778

IN THE HIGH COURT OF KERALA AT ERNAKULAM
SUSHRUT ARVIND DHARMADHIKARI, P. V. BALAKRISHNAN, JJ
B.MITHRAN – Appellant
Versus
THE KERALA STATE CO-OPERATIVE BANK LTD. – Respondent
WA NO. 1590 OF 2021 | WP(C) NO.24723 OF 2021



Advocates:
For the Appellants/Petitioners: T.R.Harikumar
For the Respondents: Gilbert George Correya, Sreekala Krishnadas, C.Vivek, Rakhi Ramachandran, Jomy Johny, Anagha Madath Thekkepatte

Employees are entitled to gratuity benefits as per the terms of their employment scheme, which can exceed statutory limits under the Payment of Gratuity Act.

Headnote:(A) Payment of Gratuity Act, 1972 - Section 4(3) and (5) - Employees Group Gratuity Pension Scheme - Challenge to the dismissal of a writ petition pertaining to gratuity disbursement - Disputed facts concerning gratuity entitled under the scheme versus limits under the Act were evaluated - Full Bench precedent cited affirming employees' entitlements to better gratuity terms under existing agreements - Court mandated the calculation of gratuity amounts as per the specific scheme rules and directed disbursement of any entitled excess amounts - The appellants' rights to the full gratuity as per the scheme were affirmed. (Paras 1-10)

Table of Content
1. final determination of the appeal and order for computation of gratuity. (Para 1 , 3)
2. details surrounding the retirement and gratuity entitlements. (Para 2)
3. court's directive regarding the calculation and disbursement of excess gratuity. (Para 4 , 10)
4. arguments related to the calculation and disbursement of gratuity. (Para 5 , 6 , 7)
5. court's evaluation of gratuity entitlement under the applicable schemes. (Para 8 , 9)

JUDGMENT

P.V.BALAKRISHNAN,J

This intra-court appeal is filed by the petitioners in W.P.(C) No.24723/2021, challenging the judgment dated 11.11.2021, passed by the learned single judge, dismissing their writ petition.

2. The appellants/writ petitioners were employees of the former Kannur District Co-operative Bank, which is now known as Kerala State Co-operative Bank. Appellants 1 and 3 retired from service on 31.05.2019 and the 2nd appellant retired on 31.01.2018. It is their case that Kannur District Co-operative Bank had joined the Employees Group Gratuity Pension Scheme introduced by the 3rd respondent in order to ensure prompt and better gratuity to its employees on their retirement. For this purpose, the bank had subscribed to a master policy and had remitted the premium to the 3rd respondent. The Scheme is a cash accumulation scheme, wherein the maximum amount of gratuity is not limited to 20 Lakhs, and the employee is entitled to gratuity as per the calculation based on the last drawn salary. At the time of retirement of the appellants, the 3rd respondent paid a sum of Rs.27,66,162/-, Rs.21,92,050 and Rs.26,09,238/- respectively to the Bank for payment of gratuity, as per Ext.P1. But, the Bank paid only an amount of Rs.20 Lakhs each to the appellants and remitted back the balance amount to the 3rd respondent. The appellants are entitled to the balance amount also. It is also their case that some employees, who retired from the very same bank, were disbursed gratuity without the ceiling limit of Rs. 20 Lakhs, as evidenced by Ext.P2. Hence, aggrieved by the non-payment of the balance amounts, the appellants preferred W.P.(C)No.30566/2019 before this Court and this Court by Ext.P3 judgment, dated 11.12.2019 disposed of the case with a direction to the Bank to pay the balance amount with 6% interest. Since the judgment was not complied with, the appellants filed Contempt Case No.413/2020 and in the meanwhile, the 2nd respondent also filed R.P.No.1010/2020 stating that there is a calculation mistake in the salary and that the gratuity was calculated including Commission, HRA, bonus, etc,. The learned single judge by Ext.P4 order dated 03.02.2021, dismissed the Review Petition and on the same day, disposed of the Contempt Case by passing Ext.P5 order, granting liberty to the appellants to file a writ petition regarding the computation. Even though the 2nd appellant filed Ext.P9 representation before the 1st respondent, no action was taken to disburse the balance amount of gratuity. Hence, the appellants filed the afore writ petition seeking the following relief:

“i) to issue a writ of mandamus or any other writ, direction or order, directing respondents 1 and 2 to disburse the balance amount of gratuity amounting to Rs.7,66,162/-, Rs.1,92,050/- and Rs.6,09,238/- to petitioners 1 to 3 respectively, with interest at the rate of 6% per annum, within a time limit fixed by this Hon'ble Court;”

3. The learned Single Judge by judgment dated 11.11.2021 dismissed the writ petition by finding that, since disputed question of facts are involved, it cannot be considered by this Court under Article 226 of the Constitution of India.

4. Heard Adv.T.R.Harikumar, the learned counsel appearing for the appellants, Adv.Gilbert George Correya, the learned standing counsel appearing for respondents 1 and 2 and Adv. Sreekala Krishnadas, the learned counsel appearing for the 3rd respondent.

5. The learned counsel for the appellants submitted that, the bank has availed a Group Gratuity Scheme from the 3rd respondent i

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