IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR BEFORE HON'BLE SHRI JUSTICE VIVEK JAIN

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ON THE 13 OF JANUARY, 2026 MISC. PETITION No. 7413 of 2025 THE MANAGING DIRECTOR AND CHIEF EXECUTIVE OFFICER Versus SHRI PRADIP CHAKRABORTY AND OTHERS Appearance:

Shri S.K. Rao- Senior Advocate With Shri Sukhendra Kushwah-Advocate for the petitioner.

Shri Amardeep Gupta- Advocate for the respondent No.1.

ORDER The present petition has been filed by the petitioner-Bank, challenging the order of the Controlling Authority under Payment of Gratuity Act, so also the order of the Appellate Authority under Payment of Gratuity Act, 1972 (for short referred to as Gratuity Act). The Controlling Authority, by its order dated 02.08.2024 had directed payment of Gratuity to the tune of Rs. 20,13,265/- and since an amount of Rs.10.00 lakhs had already been paid to the respondent employee, therefore directed to pay deficit of Rs.10,13,265/-. On an appeal being filed before the Appellate Authority, the Appellate Authority has carried out recalculation of Gratuity and has held that the respondent is entitled to total Gratuity of Rs. 15,46,997/- and as an amount of Rs. 10.00 lakhs had already been paid, the authority directed payment of balance amount of Rs. 5,46,997/- with interest @ 10% per annum on the balance payment.

2. The learned senior counsel for the petitioner Bank has vehemently argued before this court to challenge the order of the Controlling Authority as well as the Appellate Authority on two grounds. The first ground raised by the learned counsel for the petitioner Bank is that as per Payment of Gratuity (Central) Rules.1972 (for short "Gratuity Rules), there is a timeline prescribed as per Rule 7(1) to make an application in prescribed form within 30 days. It is further argued that as per Rule 10 of Gratuity Rules, the employee has to make an application within 90 days for raising the claim in Form N. It is argued that in the present case though the respondent-employee stood retired on 31.10.2017 but the application before the Controlling Authority was filed for the first time on 17.05.2023 which is with a delay of more than 5 years and therefore the Controlling Authority ought to have rejected the application on the ground of delay. It is argued that no application for condemnation of delay was filed along with the application for Gratuity and therefore the Controlling and Appellate Authorities have gravely erred in law in entertaining time-barred application.

3. The second ground raised by the counsel for the petitioner-Bank is that as per the Gratuity Act the ceiling limit since the year 2010 was 10.00 lakh which has been raised to Rs. 20.00 lakh only w.e.f. 24.03.2018 from which date the amendment in Section 4 (3) of Gratuity Act has come into force, while the respondent employee stood retired on 31.10.2017 and therefore for the respondent-employee the ceiling limit of Rs. 10.00 lakh would apply and therefore the Controlling and Appellate authorities could not have directed payment of any Gratuity over and above the ceiling limit of Rs. 10.00 lakhs and to that extent the impugned order passed by the Appellate and Controlling authorities are bad in law and deserve to be set-aside. It is argued that the Gratuity as per the ceiling limit was already paid to the employee at the time of his retirement and no further amount was payable over and above the ceiling limit and this important aspect has been totally overlooked by the authorities and therefore the impugned orders are required to be set-aside. No other ground was pressed by counsel for the petitioner.

4. Per contra, it is vehemently argued by counsel for the respondent-

employee that the Bank has framed a separate scheme for payment of Gratuity which is placed on record as Annexure P/3 and is known as Union Bank of India Employee's Gratuity Fund Rules which has been enforced from 01.01.1975 (for short referred to as "Bank Rules"). It is argued that the Bank Rules have done away with the ceili