Ravi Shankar Malani vs State Bank Of India & Ors
2023 Latest Caselaw 3407 Cal

Form No.J(2)

                IN THE HIGH COURT AT CALCUTTA
               CONSTITUTIONAL WRIT JURISDICTION
                        APPELLATE SIDE
Present :

The Hon'ble Justice Raja Basu Chowdhury

                            WPA 11196 of 2023

                           Ravi Shankar Malani
                                   Vs.
                        State Bank of India & Ors.


For the petitioner                    :       Ms. Sanjukta Dutta

For the respondent nos.1 & 2          :       Mr. S. Pal Chowdhury

Heard on                              :       16.05.2023

Judgment on                               :   16.05.2023


Raja Basu Chowdhury, J:

1. Affidavit of service filed in Court today is taken on record.

2. The present writ application has been filed, inter alia, praying for

disbursal of interest in favour of the petitioner, consequent upon

determination of gratuity payable to the petitioner under the

Payment of Gratuity Act, 1972 (hereinafter referred to as the "said

Act").

3. The petitioner claims to be a Chartered Accountant and was

appointed in the respondent bank on contractual basis vide

appointment letter dated 12th November, 2008. Although, the

initial appointment of the petitioner was for the period from 14th

November, 2008 to 13th November, 2011, the same was, however,

subsequently renewed from time to time by the respondent bank.

4. On 30th June, 2017, the petitioner had submitted his resignation

to the respondent bank after having rendered a continuous

service for a period of 8 years 7 months and 16 days i.e. between

14th November, 2008 to 30th June, 2017. Following such

resignation, the petitioner applied in Form 'I' under the provisions

of the said Act for disbursal of gratuity in his favour.

5. Since the respondent bank did not disburse the gratuity, the

petitioner had applied in Form 'N' before the Controlling Authority

under the said Act, on 10th November, 2017. On contested

hearing, the Controlling Authority was, inter alia, pleased to

determine the gratuity payable to the petitioner and by a notice in

Form-R dated 31st July, 2018, while calling upon the respondent

bank to make payment of the gratuity so determined, also

enclosed a copy of the order dated 31st July, 2018, to the

aforesaid Form-R.

6. Being aggrieved, the respondent bank had filed a statutory appeal

by making a pre-deposit as required under the provisions of the

said Act. Such appeal appears to have been filed on 25 th

September, 2018. The Appellate Authority by its order dated 31st

July, 2019, disposed of the said appeal, inter alia, by upholding

the order passed by the Controlling Authority. The respondent

bank, however, chose to challenge both the orders passed by the

Controlling Authority as well as by the Appellate Authority by

filing a writ application, which was registered as WPA 16222 of

2021, inter alia, on the ground that the petitioner did not render

continuous service for a period of five years or more. By order

dated 2nd March, 2022, a co-ordinate Bench of this Court was,

inter alia, pleased to set aside the orders passed both by the

Controlling Authority as well as by the Appellate Authority on the

ground that the petitioner had not rendered continuous service

for five years or more.

7. Being aggrieved, the petitioner had filed an appeal which was

registered as MAT 451 of 2022. By an order dated 18th April,

2022, the Division Bench of this Court by observing that the order

passed by the Controlling Authority dated 31st July, 2018, was

tested for its correctness by the Appellate Authority and after re-

examining the facts, the Appellate Authority by an order dated

31st July, 2019, having affirmed the said order, was of the view

that the order passed by the Controlling Authority and the

Appellate Authority is just and proper and ought not to be

interfered with by the writ Court. Consequent upon the same, the

Division Bench of this Hon'ble Court was pleased to affirm and

restore the orders passed by the Controlling Authority and the

Appellate Authority and had also permitted the petitioner to

withdraw the amount together with interest, lying in deposit

before the Controlling Authority on production of a server copy of

the judgment.

8. The petitioner had since applied before the office of the

Controlling Authority and had withdrawn the money lying in

deposit amounting to Rs.4,72,020/- on 24th August, 2022. Since

according to the petitioner, the petitioner was also entitled to

additional interest for failure on the part of the respondent bank

to comply with the direction given by the Controlling Authority

and the Appellate Authority, the petitioner had applied in Form 'T'

on 5th September, 2022, for issuance of a certificate in terms of

Section 8 of the said Act.

9. Consequent upon receipt of such application, the Controlling

Authority had by a communication in writing dated 2nd December,

2022, called upon the General Manager of the respondent bank to

follow the order passed by the Controlling Authority and the

Appellate Authority and pay simple interest for delayed payment

at the rate of 10 per cent per annum on the gratuity amount as

determined by the Controlling Authority in favour of the

petitioner.

10. Upon receipt of such communication, the respondent bank

appears to have responded to the same by a communication in

writing dated 14th December, 2022, and had brought to the notice

of the Controlling Authority the judgment passed by the Division

Bench of this Hon'ble Court dated 18th April, 2022. It was further,

inter alia, represented that in terms of the judgment delivered by

the Hon'ble Court, no further payment was required to be made to

the petitioner.

11. It appears that by a communication in writing dated 25th

January, 2023, the Controlling Authority upon receipt of the

response from the respondent bank has concluded that in terms

of the direction issued by the Division Bench of this Hon'ble Court

on 18th April, 2022, the petitioner having been disbursed the

money lying in deposit, along with the accrued interest with the

Controlling Authority, no further action is required to be taken at

their end and the dispute at their end is treated as closed.

12. Ms. Dutta, learned advocate representing the petitioner,

submits that the Controlling Authority ought not to have rejected

the petitioner's application in Form 'T' on the basis of the

response given by the respondent bank. By drawing attention of

this Court to the judgment and order dated 18th April, 2022, it is

submitted that the Hon'ble Division Bench of this Court had, in

fact, restored the orders passed by the Controlling Authority and

the Appellate Authority. Consequential direction passed by the

Hon'ble Court, was only to expedite the payment for disbursal of

the gratuity lying with the Controlling Authority and not to

interfere with the petitioner's statutory right as provided under

the said Act.

13. It is submitted that the Payment of Gratuity Act, is a social

welfare legislation and the respondent bank cannot be permitted

to deny the petitioner's entitlement to the interest, as directed to

be disbursed in favour of the petitioner, both by the Controlling

Authority and the Appellate Authority. She says that the

respondent bank should be directed to make payment of interest

in terms of the direction passed by the Controlling Authority and

the Appellate Authority in their respective orders. She prays for

disbursal of compound interest in favour of the petitioner.

14. Per contra, Mr. Pal Chowdhury, learned advocate representing

the respondent bank, on the other hand, submits that the bank

cannot be faulted for delayed disbursal of the gratuity in favour of

the petitioner. It is submitted that immediately upon being

notified vide notice dated 31st July, 2018, issued in Form 'R', the

respondent bank while preferring an appeal, which is recognized

by the statute, deposited with the Controlling Authority the

amount of gratuity so determined by the Controlling Authority

under the said Act. The respondent bank has a statutory right

and cannot be faulted for having exercised its right as provided

under the statute. It is submitted that immediately upon the

Division Bench of this Hon'ble Court, restoring the orders passed

by the Controlling Authority and the Appellate Authority that the

amount deposited by the respondent bank with the Controlling

Authority was disbursed in favour of the petitioner on 24th

August, 2022.

15. It is submitted that in this case, admittedly, no certificate

under Section 8 of the said Act, has been issued and as such no

further interest is payable by the respondent bank. In support of

the aforesaid contention, he has placed reliance on an unreported

judgment delivered by the Hon'ble High Court of Chhattisgarh at

Bilaspur, in the case of Secretary, Board of Trustees, NTPC

Employees Gratuity Fund v. Shri S. N. Bhojasiya & Ors. in

WP No. 17141 of 2002. He submits that the present writ

application is unmeritorious and the same should be dismissed.

16. Heard the learned advocates appearing for the respective

parties and considered the materials on record. In this case, I find

that the respondent bank had challenged the order passed by the

Controlling Authority, initially before the Appellate Authority and

subsequently by filing a writ application when the appeal failed.

Both the aforesaid orders dated 31st July, 2018 and 31st July,

2019, passed by the Controlling Authority and the Appellate

Authority respectively under the said Act were challenged by filing

a writ application.

17. The respondent bank ultimately did not succeed. By a

judgment and order delivered by the Hon'ble Division Bench of

this Court on 18th April, 2022, the order passed by the Controlling

Authority which had been set aside by the learned Single Judge

was restored upon the same being affirmed. Since the order

passed by the Controlling Authority and the Appellate Authority

was affirmed by the Division Bench, in my view, the writ

petitioner is entitled to the benefit of the aforesaid orders in the

mode and manner as directed therein.

18. Although Mr. Pal Chowdhury, learned advocate, has

strenuously argued by relying on an unreported judgment

delivered in the case of S. N. Bhojasiya (supra), to, inter alia,

contend that unless a certificate is issued under Section 8 of the

said Act, no interest is payable, I am afraid, and am unable, to

accept the same. A perusal of the provisions of the said Act, inter

alia, including Section 8 thereof, would in no uncertain terms

demonstrate the right of an employee as defined in the said Act,

to enforce an order passed by the Controlling Authority in the

manner provided therein. To morefully appreciate the aforesaid

provisions, Section 8 of the said Act is extracted hereinbelow:-

"8 Recovery of gratuity: - If the amount of gratuity payable under this Act is not paid by the employer, within the prescribed time, to the person entitled thereto, the Controlling Authority shall, on an application made to it in this behalf by the aggrieved person, issue a certificate for that amount to the Collector, who shall recover the same, together with compound interest thereon [at such rate as the Central Government may, by notification specify], from the date of expiry of the prescribed time, as

arrears of land revenue and pay the same to the person entitled thereto.

[Provided that the Controlling Authority shall, before issuing a certificate under this section, give the employer a reasonable opportunity of showing cause against the issue of such certificate:

Provided further that the amount of interest payable under this section shall in no case exceed the amount of gratuity payable under this Act]."

19. It would further appear from the provisions of Payment of

Gratuity (Central) Rules, 1972 (hereinafter referred to as the "said

Rules"), that elaborate procedure had been laid down not only

with regard to the direction for payment of gratuity but also for

appeal. Procedure has also been made regarding application for

recovery of gratuity. Rule 19 of the said Rules in particular,

provides for application for recovery of gratuity. To morefully

appreciate the aforesaid provision, the same is extracted

hereinbelow:-

"19 Application for recovery of gratuity:- Where an employer fails to pay the gratuity due under the Act in accordance with the notice by the controlling authority under rule 17 or rule 18, as the case may be, the employee concerned, his nominee or legal heir, as the case may be, to whom the gratuity is payable may apply to the controlling authority in duplicate in Form 'T' for recovery thereof under section 8 of the Act."

20. It would, thus, appear from the above that in the event

an employer fails to pay gratuity due under the said Act in

accordance with the notice by the Controlling Authority under

Rule 17 or under Rule 18, as the case may be, the employee

concerned, his nominee or legal heir, as the case may be, to

whom the gratuity is payable may apply to the Controlling

Authority in duplicate, in Form 'T' for recovery thereof under

Section 8 of the Act.

21. In this case the first notice under Rule 17 was issued in Form-

R on 31st July, 2018. Since the Appellate Authority upheld the

order passed by the Controlling Authority, the respondent bank

was required to immediately comply with such direction. The

respondent bank had stood in the way of the petitioner receiving

the amount of gratuity and had challenged the orders passed both

by the Controlling Authority and the Appellate Authority, by

invoking the extraordinary writ jurisdiction of this Court.

22. The challenge ultimately did not succeed and the Division

Bench of this Court was, inter alia, pleased to uphold the orders

passed by the Controlling Authority as well as the Appellate

Authority. Once the orders were upheld, the respondent bank

cannot be permitted to take advantage of the delay caused in

disbursing the gratuity in favour of the petitioner. As such, the

petitioner cannot be faulted for applying before the Controlling

Authority for issuance of certificate under Section 8 of the said

Act. I, also do not subscribe to the view that unless a certificate is

issued no interest can be claimed. The judgment relied on by Mr.

Pal Chowdhury, also does not assist him and is distinguishable

on facts. In that particular case, as is recorded in paragraph 11 of

the said judgment, no such application was made before the

Controlling Authority for issuance of certificate under Section 8 of

the said Act. Such is not the case here. The respondent bank had

taken a chance by filing the writ petition which ultimately did not

succeed. As such the respondent bank is bound to face the

consequence for its action. In view thereof, the communication

dated 25th January, 2023, issued by the Controlling Authority at

pages 91 and 92 cannot be sustained and the same is accordingly

set aside and quashed.

23. The Controlling Authority under the said Act is directed to

decide the petitioner's application in Form 'T' in accordance with

law on the basis of the observations made hereinabove after giving

an opportunity of hearing to the parties and after further issuing

a fresh show cause on the respondent bank.

24. With the above observations and/or directions, the writ

application is disposed of without any order as to costs.

25. Since I have not called for any affidavits, the allegations

contained in the writ application are deemed to have been denied

by the respondents.

26. Urgent Photostat certified copy of this order, if applied for, be

given to the parties, upon compliance with requisite formalities.

(Raja Basu Chowdhury, J.)

S.B.

Assistant Registrar (Court)