The Calcutta High Court allowed an arbitration petitioner for permission to withdraw an amount of Rs.3.4 crores upon furnishing a bank guarantee for an equivalent amount. The impugned Award which forms the subject matter of the Arbitration Petition is of 25th April 2012. The Court observed that under no circumstances the respondents could have withheld gratuity payable in favour of the petitioner, in the absence of any provision authorizing the same.
Brief Facts:
The petitioner claims to be an ex-employee of respondent no.1. It is his case that he was appointed in the year 1974 as Assistant Medical Officer and was subsequently promoted to the post of Assistant Chief Medical Officer in the year 1997. On the basis of a complaint against the petitioner, an investigation was started by the Central Bureau of Investigation. The petitioner was suspended. According to the petitioner, the respondents were obliged in terms of Rule 20(2) of the said rules to revoke the order of suspension, upon the petitioner being enlarged on bail. The respondents having not revoked such order of suspension, a writ application was filed before the Hon’ble Court challenging the said order of suspension.
During the pendency of the writ application, since the petitioner was due to retire by a notice in writing dated 20th December 2006, the petitioner was further informed that by reason of the pendency of judicial/criminal proceedings against him, the management had decided that the gratuity shall be paid to the petitioner on the conclusion of the proceeding subject to the decision of the appropriate Court/authority. By a judgement and order dated 31st August 2012, the petitioner was acquitted.
Contentions of the Petitioner:
The Learned Counsel for the Petitioner submitted that the respondents at that stage without any authority in law had purportedly held out that they would withhold the gratuity payable to the petitioner by reasons of pendency of judicial/criminal proceedings. He contended that the provisions contained in the rules do not authorize the respondents to withhold the petitioner’s terminal benefits, on account of pendency of any judicial/criminal proceedings.
Contentions of the Respondent:
The Learned Counsel for the Respondent submitted that the respondents always intended to clear the terminal benefits as were payable to the petitioner. The terminal benefits had been held back by reason of the pendency of the criminal proceedings. He submits that the Central Bureau of Investigation has since, preferred an appeal from the judgment and order dated 31st August 2012, and this Hon’ble Court by an order dated 21st July 2013, in CRM SPL No.31 of 2013, has, inter alia, granted special leave to appeal.
Observations of the Court:
The Court noted that the respondents while issuing the notice of superannuation had categorically provided therein that since judicial/criminal proceeding against the petitioner was in progress, the respondents had decided that gratuity should be paid to the petitioner on the conclusion of the proceeding subject to the decision of the appropriate Court or authority.
The Court observed that the respondents in terms of the provision of the Payment of Gratuity Act, 1972 were obliged to make payment of the gratuity. Admittedly, Section 13 of the Payment of Gratuity Act, 1972 accords protection of gratuity while Section 14 gives an overriding effect to the provisions of Section 13 of the Payment of Gratuity Act, 1972. The Court said that under no circumstances the respondents could have withheld gratuity payable in favour of the petitioner, in the absence of any provision authorizing the same. Further, on account of the non-vacating of the company’s quarter, the respondents could not have withheld either the terminal benefits or gratuity payable to the petitioner.
The decision of the Court:
The Calcutta High Court, allowing the application, held that there shall be an order directing the respondents to forthwith release the terminal benefits as admitted in paragraph 3(g) of the said supplementary affidavit in favour of the petitioner.
Case Title: Samar Bijoy Bhowmick vs Garden Reach Ship Builders & Engineering Ltd. & Ors.
Coram: Hon’ble Justice Raja Basu Chowdhury
Case no.: WPO/1881/2006
Advocate for the Petitioner: Mr. Subir Sanyal
Advocate for the Respondent: Mr. Ranjay De
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