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Rules HIMFED Enhanced Gratuity Only From
In a significant ruling on service benefits, the has held that retired employees of the are not entitled to the enhanced gratuity ceiling of ₹20 lakh if they superannuated before . A Division Bench comprising Justice Ajay Mohan Goel and Justice Yogesh Jaswal dismissed a writ petition filed by former employees who had retired between and .
The Battle Over the Effective Date
The petitioners, represented by , had challenged HIMFED's notification dated , and a subsequent that extended the enhanced gratuity limit only from . They argued that the State Government's dated , which increased the gratuity ceiling from ₹10 lakh to ₹20 lakh with effect from , should equally apply to HIMFED employees. The petitioners contended that HIMFED, being wholly owned and controlled by the State, could not create an artificial distinction based on retirement dates.
The Federation, represented by , countered that the gratuity of its employees was governed not by State government rules but by the , under the HIMFED Service Rules. Since the Central Government enhanced the ceiling under the Act only from , the Federation had correctly adopted the same date.
Rule 3.10 Decoded
The Court closely examined , as amended on , which states:
"Every employee of the Federation shall be entitled to gratuity and leave encashment benefits on attaining the age of superannuation or premature retirement as per provisions of the gratuity act, and Leave rules applicable to the Govt. employees as amended from time to time."
The Bench observed that this rule clearly separates the two benefits – gratuity payments are linked strictly to the Gratuity Act, while leave encashment follows government leave rules. Therefore, the government's decision to enhance gratuity for its own employees from could not automatically apply to HIMFED employees.
Why the State OM Didn't Help
The Additional Advocate General for the State, , argued that the was intended only for State government employees. The Court accepted this position, noting that no direction had been issued by the State to extend the benefit to corporations and federations like HIMFED.
The Court observed: “Why the State Government has given the benefit of the revision of gratuity to its employees from 01.01.2016 is best for the Government to explain. However, simply because the Government has taken this decision, this does not confer any right upon the petitioners to ask this Court to issue a to the respondent-Federation to implement the same for its employees.”
Key Observations
The judgment underscored that the cut-off date , was not arbitrarily chosen by HIMFED. It was the date on which the Payment of Gratuity Act itself was amended by the .
The Court said: “Neither do we find any arbitrariness in the issuance of this Notification and making it effective from 29.03.2018, nor do we find any discrimination against the petitioners, because obviously, as the stood amended w.e.f. 29.03.2018, any incumbent who stood superannuated before 29.03.2018, is not entitled for the benefit of the said amendment.”
The Final Order
The High Court dismissed the writ petition in its entirety, holding that HIMFED's action was both legal and rational. However, it granted the petitioners liberty to pursue their claims regarding arrears of revised pay scale and leave encashment through separate proceedings. The Court expressly refrained from expressing any opinion on the extent of State control over HIMFED.
The decision reinforces that employees of autonomous corporations governed by the Payment of Gratuity Act cannot claim a beyond the statutory amendment date, even if the State government has granted more favorable terms to its own workforce.
