Bombay High Court
Maharashtra Gramin Bank, Head ... vs Vasant Narsingrao Hadule And ... on 3 March, 2021
Bench: R. G. Avachat
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 1 ::
IN THE HIGH COURT OF JUDICATURE OF BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO.2793 OF 2014
The Chairman
Maharashtra Gramin Bank,
Head Office, Shivaji Nagar,
Nanded ...PETITIONER
VERSUS
1) Sheshrao s/o Dnyandeo Gore,
Age 57 years, Occ. Nil,
R/o 'Krushisampada',
Sahyog Colony, Ring Road,
Latur
2) The Controlling Authority
Under Payment of Gratuity Act, 1972
& Assistant Labour Commissioner (C),
Ramnagar, Chandrapur,
Maharashtra State
3) The Appellate Authority
Under P.G. Act, 1972 &
Regional Labour Commissioner (C),
CGO Complex, Block-C,
Ist Floor, Seminary Hills,
Nagpur - 6 (M.S.) ... RESPONDENTS
.......
Shri M.M. Patil Beedkar, Advocate for petitioner
Shri R.D. Biradar, Advocate for respondent No.1
Shri Y.G. Gujarathi, A.G.P. for respondents No.2 & 3
.......
WITH
WRIT PETITION NO.3908 OF 2014
Maharashtra Gramin Bank,
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Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 2 ::
Head Office, Shivaji Nagar,
Nanded, through its Chairman ...PETITIONER
VERSUS
1) Vasant s/o Narsingrao Hadule
Age Major, Occ. Nil,
R/o C/o Shri D.R. Ambedkar,
Sahyog Colony, Near Shanimandir,
Ring Road, Latur, Tq. & ist. Latur.
2) The Controlling Authority
Under Payment of Gratuity Act, 1972
& Assistant Labour Commissioner (C),
Ramnagar, Chandrapur,
Maharashtra State
3) The Appellate Authority
Under P.G. Act, 1972 &
Regional Labour Commissioner (C),
CGO Complex, Block-C,
Ist Floor, Seminary Hills,
Nagpur - 6 (M.S.) ... RESPONDENTS
(Respondents No.2 & 3 deleted as per
order dated 18/7/2018)
.......
Shri M.M. Patil Beedkar, Advocate for petitioner
Shri R.D. Biradar, Advocate for respondent No.1
.......
WITH
WRIT PETITION NO.3910 OF 2014
Maharashtra Gramin Bank,
Head Office, Shivaji Nagar,
Nanded, through its Chairman ...PETITIONER
VERSUS
1) Dayanand s/o Wamanrao Waghmare
Age Major, Occ. Nil,
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Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 3 ::
R/o Triratna Ajnikar Niwas,
Bank Colony, Vikram Nagar,
Tq. & Dist. Latur (M.S.)-413531
2) The Controlling Authority
Under Payment of Gratuity Act, 1972
& Assistant Labour Commissioner (C),
Chandrapur, Maharashtra State
3) The Appellate Authority
Under P.G. Act, 1972 &
Regional Labour Commissioner (C),
CGO Complex, Block-C,
Ist Floor, Seminary Hills,
Nagpur - 6 (M.S.) ... RESPONDENTS
(Respondents No.2 & 3 deleted as per
leave granted by the Hon'ble Court
on 22/12/2015)
.......
Shri M.M. Patil Beedkar, Advocate for petitioner
Shri R.D. Biradar, Advocate for respondent No.1
.......
CORAM : R. G. AVACHAT, J.
Date of reserving order : 17th February, 2021
Date of pronouncing order : 3rd March, 2021
O R D E R:
These three Writ Petitions are being decided by
this common order since common questions of facts and law
arise therein.
2. The Maharashtra Gramin Bank (Bank), Nanded is
the petitioner in all these petitions. The respondent No.1 in
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 4 ::
all these petitions (respondents) were officials of the Bank.
The respondent No.2 in all these petitions is the Controlling
Authority under Payment of Gratuity Act, 1972 (for short the
Act of 1972) while respondent No.3 is the Appellate Authority
under the Act of 1972.
3. The respondents were subjected to separate
departmental enquiries. Charges framed against them have
been proved. The respondents, therefore, came to be
dismissed from service. The orders of their dismissal from
service have attained finality. The details thereof are as
under:-
W.P. Number Respondent's Reason for Date of Date of filing
name and dismissal/ dismissal/ application
designation termination termination for payment
of gratuity
2793/ 2014 Sheshrao Defalcation and 17/12/2003 8/12/2011
Dnyandeo Gore, misappropriation
Branch Manager of funds
3908/ 2014 Vasant Narsingrao Raising funds for 9/3/2012 17/9/2012
Hadule, his Union,
Branch Manager Collecting /
accepting amounts
from customers/
borrowers of the
Branch in cash
and then
depositing the said
amount in his own
name and sending
the same to the
Accounts of his
Union
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 5 ::
3910/ 2014 Dayanand Defalcation and 12/7/2012 13/7/2012
Wamanrao misappropriation
Waghmare, of Bank funds by
Manager making fictitious
entries in
the name
of various
Account holders
and misuse of
official power for
personal gain
4. The respondents preferred applications for
payment of gratuity. The Bank resisted the applications on
the ground that the respondents have been terminated from
service since the acts committed by them were of moral
turpitude. The contentions raised by the Bank were negatived
by the controlling authority under the Act of 1972. The
controlling authority, vide its order dated 10/4/2013,
28/2/2013 and 28/3/2013 directed the Bank to pay the
respondents the amount of gratuity. The Bank preferred
appeals to the appellate authority. The appellate authority
dismissed the appeals vide judgments and orders dated
13/2/2014, 4/3/2014 and 10/3/2014.
5. Shri M.M. Patil Beedkar, learned counsel for the
Bank would submit that, the definition of the term 'moral
turpitude' is wide enough. The acts committed by the
respondents on account of which they have been dismissed
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 6 ::
from service constitute moral turpitude. According to learned
counsel, for forfeiture of the gratuity on account of any act
which constitutes an offence involving moral turpitude, such
employee need not be prosecuted in the Court of law.
Learned counsel placed reliance on the judgment of this Court
in Writ Petition No.12405/2019 and other connected petitions,
decided on 16/12/2019. According to learned counsel, this
Court has interpreted the judgment of the Apex Court in case
of Union Bank of India Vs. C.G. Ajay Babu reported in (2018)
9 SCC 529. He would further submit that, the parties to the
judgment in Writ Petition No.12405/2019 were the present
Bank and its employees. These Writ Petitions, therefore, need
to be decided in terms of the judgment and order passed in
the said Writ Petitions, otherwise there would be conflict of
decisions. He, therefore, urged for allowing the Writ Petitions.
6. Shri R.D. Biradar, learned counsel for the
respondents would, on the other hand, submit that, for
forfeiture of amount of gratuity under Section 4(6)(b)(ii) of
the Act of 1972, the services of such employees must have
been terminated for any act which constitutes an offence
involving moral turpitude, provided that such offence is
committed by him in the course of his employment. Learned
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 7 ::
counsel has relied on the judgment of the Apex Court in Ajay
Babu's case (supra).
7. Section 4(6)(b)(ii) of the Act of 1972 reads as
follows :-
"4. Payment of gratuity -
1. ..............
2. ..............
3. ..............
4. ..............
5. ..............
6. Notwithstanding anything contained in sub-
section (1)-(b) the gratuity payable to an employee [may
be wholly or partially forfeited]-
(i) ............
(ii) if the services of such employee have been
terminated for any act which constitute an offence
involving moral turpitude, provided that such offence is
committed by him in the course of his employment."
8. The amount of gratuity payable to the respondents
herein, is sought to be forfeited on the ground contained in
Section 4(6)(b)(ii) of the Act of 1972. The respondents have
been dismissed from service for the reasons stated in column
No.3 of the table given in paragraph No.3 above. Their
dismissal has attained finality as they have been unsuccessful
in the proceedings initiated for challenging their dismissal.
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 8 ::
9. Section 4(6)(b)(ii) of the Act of 1972 empowers
an employer to forfeit gratuity wholly or partially in case the
services of such employee have been terminated for any act,
which constitutes an offence involving moral turpitude,
provided such offence is committed by him in the course of
his employment.
10. In case of C.G. Ajay Babu (supra), the Apex Court
observed :-
"16. Under sub-section 6(a), also the gratuity can be
forfeited to only to the extent of damage or loss caused to
the Bank. In case, the termination of the employee is for
any act or willful omission or negligence causing any
damage or loss to the employer or destruction of property
belonging to the employer, the loss can be recovered
from the gratuity by way of forfeiture. Whereas under
sub-Clause (b) of sub-section (6), the forfeiture of
gratuity, either wholly or partially, is permissible under
two situations ; (i) in case the termination of an employee
is on account of riotous or disorderly conduct or any
other act of violence on his part, (ii) if the termination is
for any act which constitutes an offence involving moral
turpitude and the offence is committed by the employee
in the course of his employment. Thus, sub-Clause (a)
and sub-Clause (b) of sub-Section (6) of Section 4 of the
Act operate in different fields and in different
circumstances. Under sub-Clause (a), the forfeiture is to
the extent of damage or loss caused on account of the
misconduct of the employee whereas under sub-Clause
(b), forfeiture is permissible either wholly or partially in
totally different circumstances. Sub-Clause (b) operates
either when the termination is on account of - (i) riotous
or (ii) disorderly or (iii) any other act of violence on the
part of the employee, and under Sub-Clause (ii) of sub-
Section (6)(b) when the termination is on account of any
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 9 ::
act which constitutes an offence involving moral
turpitude committed during the course of employment.
17. Offence is defined, under The general Clauses Act,
1897, to mean any act or omission made punishable by
any law for the time being in force.
18. Though the learned Counsel for the appellant-
Bank has contended that the conduct of the respondent-
employee, which leads to the framing of charges in the
departmental proceedings involves moral turpitude, we
are afraid the contention cannot be appreciated. It is not
the conduct of a person involving moral turpitude that is
required for forfeiture of gratuity but the conduct or the
act should constitute an offence involving moral
turpitude. To be an offence, the act should be made
punishable under law. That is absolutely in the realm of
criminal law. It is not for the Bank to decide whether an
offence has been committed. It is for the Court. Apart
from the disciplinary proceedings initiated by the
appellant-Bank, the Bank has not set the criminal law in
motion either by registering an FIR or by filing a criminal
complaint so as to establish that the misconduct leading
to dismissal is an offence involving moral turpitude.
Under sub-Section (6)(b)(ii) of the Act, forfeiture of
gratuity is permissible only if the termination of an
employee is for any misconduct which constitutes an
offence involving moral turpitude, and convicted
accordingly by a Court of competent jurisdiction."
11. In the present case, the respondents have not
been prosecuted for the misconduct which is alleged to be an
offence involving moral turpitude. True, this Court in Writ
Petition No.12405/2019 has observed :-
"29. In my view, considering the law referred to above, it
is within the domain of the employer to enquire into the
charges leveled against an employee. It is the employer's
obligation to prove the charges so as to hold the employee
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 10 ::
guilty of the charges leveled upon him. In service
jurisprudence, it is not the duty or obligation of the charge-
sheeted workman to prove his innocence. The principle of
onus probandi would exclusively apply to an employer
who levels the charge of misconduct against the employee.
The burden would never shift (A. Raghavamma vs. a.
Chenchamma, AIR 1964 SC 136). It is the employer who
has to prove the misconduct and thereafter, the employee
would lead evidence to disprove the allegations leveled
upon him by the employer. Eventually, if the charge is
proved, it is for the employer to consider as to whether, the
misconduct proved against an employee would amount to
an act of moral turpitude, before passing an order of
forfeiture of gratuity.
30. Once an employer proves the charges and the
offence held to be committed by an employee appears to be
involving moral turpitude to any prudent man, an employer
can then involve Section 4(6)(b)(ii) of the Payment of
Gratuity Act, 1972 so as to pass an order of forfeiture of
gratuity. Section 4(6)(b)(ii) of the Act of 1972 reads as
follows :-
"4. Payment of gratuity -
(6) Notwithstanding anything contained in sub-section (i) :-
(a) .......
(b) the gratuity payable to an employee may be wholly or
partially forfeited.
(i) ............
(ii) if the services of such employee have been terminated for
any act which constitutes an offence involving moral
turpitude, provided that such offence is committed by him
in the course of his employment.
31. Considering the view expressed by my Brother in
Laxman Balu Deulkar (supra) and the law holding the field,
I am also of the view that, after an employer proves an
offence in disciplinary proceeding against an employee,
which involves moral turpitude, the employer is not required
to go to the police station and initiate a proceeding for
proving the said charge in a court having criminal
jurisdiction.
32. The view taken in C.G. Ajay Babu (supra) would not
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 11 ::
apply to the cases in hand since, in the said case, there was a
bipartite settlement in the appellant Bank in which provided
for forfeiture of gratuity only if financial loss was caused to
the Bank on account of a misconduct, which led to the
employee's dismissal. It was in this backdrop that the
Hon'ble Supreme Court concluded, in C.G. Ajay Babu's
case (supra) that recourse to Section 4(6) of the Payment of
Gratuity Act, 1972 for forfeiture of gratuity was not possible
as the bipartite settlement introduced special clauses and
protected the workmen from forfeiture of gratuity until a
financial loss was proved to have been caused to the
employer.
12. It has been informed that, an application has been
moved for review of the judgment in Writ Petition
No.12405/2019 and connected petitions and the Court has
issued notice thereon.
13. This Court (at Nagpur bench), in Writ Petition
No.6006/2016 has, relying on the judgment of the Apex Court
in C.G. Ajay Babu's case, held :-
"21. Hence, it becomes very clear that the Hon'ble
Supreme Court did lay down its opinion regarding
Section 4(6)(b)(ii) of the said Act, while deciding the
specific question framed in the facts and circumstances of
that case. Therefore, the said opinion of the Hon'ble
Supreme Court is binding on this Court."
14. Moreover, this Court (Principal Seat), relying on
the judgment in C.G. Ajay Babu's case, has reviewed its
judgment and order in Writ Petition No.9044/2017.
Writ Petition No.2793/2014 with
W.P.Nos.3908/2014 & 3910/2014
:: 12 ::
15. In my view, the Apex Court in C.G. Ajay Babu's
case, has interpreted provisions of Section 4(6)(b)(ii) of the
Act of 1972. Following the said judgment, it needs to be
observed that, the amount of gratuity payable to the
respondents herein is not liable to be forfeited, since they
have not been held by a Court of competent jurisdiction, to
have committed an act, for which their services have been
terminated, constituting an offence involving moral turpitude.
16. The Writ Petitions, therefore, fail. The same are
dismissed. Rule is discharged.
( R. G. AVACHAT )
JUDGE
fmp/-
