Chattisgarh High Court
Laxmi Narayan Sharma vs Steel Auhority Of India Ltd on 14 March, 2022
1
AFR
HIGH COURT OF CHHATTISGARH, BILASPUR
Writ Appeal No. 434 of 2021
Laxmi Narain Sharma son of late Pyare Lal Sharma, aged about 82 years,
resident of MIG-1/278, Hudco, Bhilai Nagar, Durg, District- Durg (C.G.)
---- Appellant
Versus
1. Steel Authority of India Ltd., Bhilai Steel Plant, Bhilai (C.G.), through
Managing Director (now C.E.O.), Ispat Bhawan, Bhilai Steel Plant, Bhilai,
District-Durg (C.G.)
2. State of Chhattisgarh, through the Chief Secretary, Ministry of Labour
Department, Mantralaya, Mahanadi Bhawan, Atal Nagar, Naya Raipur,
District - Raipur (C.G.)
3. Appellate Authority under the Payment of Gratuity Act, 1972, Dy. Labour
Commissioner, Block-3, 2nd Floor, Indravati Bhawan, Naya Raipur, District
Raipur (C.G.)
4. Controlling Authority under the Payment of Gratuity Act, 1972, Assistant
Labour Commissioner, Ravi Shankar Stadium (in front of Manas Bhawan),
Durg, District Durg (C.G.)
---- Respondents
(Cause-title taken from Case Information System)
For Appellant : Mr. Laxmi Narain Sharma, petitioner in person
For Respondent No.1 : Mr. P.R. Patankar, Advocate.
For Respondent No. 2 : Mr. Gagan Tiwari, Dy. Govt. Advocate.
Reserved on 21-02-2022
Judgment delivered on 14-03-2022
Hon'ble Mr. Arup Kumar Goswami, Chief Justice
Hon'ble Mr. N.K. Chandravanshi, Judge
CAV JUDGMENT
Per N.K. Chandravanshi, J.
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1. This writ appeal has been preferred against an order dated
07.10.2021 passed by learned Single Judge in Writ Petition (L) No. 115 of
2020, whereby writ petition (L) filed by appellant / petitioner has been
dismissed.
2. This case has travelled various fora at different times and the
detailed facts have been summarised by learned Single Judge from
paragraphs 3 to 7, which are as follows :-
"3. Brief facts of the case relevant for the adjudication of
the present dispute are that Petitioner was appointed under
Respondent No.1 establishment i.e. Steel Authority of India
Limited (SAIL) way back in the year 1958 and on attaining
the age of superannuation he retired on 31.5.1996. Upon
the Petitioner not receiving the Gratuity on his
superannuation, he preferred a dispute before the
Controlling Authority under the Payment of Gratuity Act and
Assistant Labour Commissioner, Durg where the case was
registered as Case No.11/PGA/DA/1997. After hearing the
parties, the Controlling Authority vide Order dated
24.6.1998 (Annexure P-2) allowed the application filed by
Petitioner and directed Respondent No.1-SAIL to pay a
sum of Rs.2,14,925/- towards Gratuity.
4. The said Order dated 24.6.1998 was subjected to
challenge by the Management of SAIL vide W.P.
No.5925/1998 by making the Petitioner herein also as one
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of the Respondents. Petitioner was the Respondent No.209
in the said Writ Petition. The High Court after hearing the
parties finally vide its Order dated 21.2.2007 (Annexure P-4)
allowed the said Writ Petition by holding as under:-
"9. Learned Counsel appearing for the
petitioner would submit that based on the
calculation sheet Annexure P/6, some of
the respondents are making demands
with the petitioner-Company for settling
the gratuity amount. Learned counsel
would further submit that the 4 th
respondent has not passed any orders
and the same are not communicated to
the petitioner. However, learned counsel
appearing for the respondents No.136
would submit that the 4th respondent has
passed an order under the provisions of
the Act. In our opinion, if that is so, the
respondents would file an appropriate
award before the petitioner to comply with
the orders and directions issued by the
Competent Authority. If and when such
awards are produced before the petitioner
for settling the claims made in the awards,
we are inclined to given an opportunity to
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the petitioner to question those awards
before the appropriate forum within a
particular time frame. In view of the
above, the following :
Order
(1) The allegations made by the petitioner against the
4th respondent in the writ petition are expunged.
(2) The 4th respondent shall not claim any damages
against the petitioner for the so called allegations made in
the writ petition.
(3) The respondents are at liberty to approach the
petitioner-Company to settle their claim, if any, under the
provisions of the Act, if they have an award in their
possession within two months from today. If such awards
are produced before the petitioner, the petitioner is at
liberty to question the same before the appropriate forum
within a month thereafter. If and when such appeals are
filed by the petitioner-Company the appellate forum shall
decide the same on merits without reference to the period
of limitation.
(4) with the aforesaid observations and directions, the
writ petition is disposed of.
(5) Ordered accordingly."
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5. Based upon the disposal of the said Writ Petition, the
Petitioner herein again appeared before the Controlling
Authority under the Payment of Gratuity Act for initiating
recovery proceeding and an Order was passed in his favour
on 14.1.2008 (Annexure P-5). This time the Controlling
Authority had ordered for payment of Rs.3,64,424/-. This
Order dated 14.1.2008 was again challenged by Respondent
No.1 in a bunch of Writ Petitions in which the petition
pertaining to Petitioner was W.P.(L) No.1290/2008 wherein
after hearing all the parties to the proceedings, the learned
Single Bench of this Court again vide Order dated 24.7.2009
(Annexure P-6) allowed the Writ Petition by holding as
under:-
"23. Other submission that the controlling
authority decided all the 290 cases of payment of
gratuity by a common order after consolidating
the same and therefore by virtue of direction of
the controlling authority the impugned order and
calculation sheets prepared by the Labour
Inspector becomes a separate award in each
case and the management ought to have
preferred appeal in each case is concerned, this
Court has already upheld the finding of the
appellate authority that the order impugned was
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passed by the controlling authority in collusion
with the applicant-employees in a clandestine
manner, the order was passed after 24.6.1998
and there is anti-dating. Once it is held that the
order is passed in collusion with a party, the
same becomes nullity in the eyes of law and it
can be impugned by the aggrieved at any stage
including by way of filing writ petition. Therefore, I
do not find force in the argument of Mr. Saxena,
learned counsel for the employees that the Act,
1972 being complete Code, the aggrieved i.e.
SAIL management in the instant case, was
required to challenge the order in favour of each
employee separately before the appellate
tribunal and in the absence of appeal by the
management, the same has attained finality.
ORDER
24. In the result;
W.P. No.3845/1999 filed by petitioner R.S. Kashyap
is hereby dismissed.
W.P.(L) No.800/2008 & other batch petitions filed by
the SAIL are allowed and the Revenue Recovery
Certificates issued by the Controlling Authority on the
application of individual employees under Section 8 of the
Act are hereby quashed.
The appellate authority shall decide all applications
for payment of gratuity, which were disposed of by order
dated 24.6.1998 passed by the Controlling Authority in
Case No.11/PGA/DG/1997, afresh as per directions of the
appellate authority vide its order dated 22.4.1999 passed
in Appeal Case No.47/PGA/98."
6. Thereafter, the matter was again subjected to challenge in a
Writ Appeal i.e. W.A. No.381/2009 and another connected
Appeal. The Division Bench of this Court again while dismissing
the said Appeals vide Order dated 11.12.2012 (Annexure P-7),
taking into consideration the submissions made by Respondent
No.1-SAIL, in paragraph 18 to 21 has held as under:-
"18. It is correct that SAIL had filed only one appeal
against the order dated 24.6.1998. In that appeal only
Shri Kashyap was the respondent. However, the
important point to be noted in this regard is that there
was no separate orders for other persons. The order
was one and the same, which was passed in the case
of Shri Kashyap. In other cases this order has been
made as a basis. Once the order dated 24.6.1998 was
set aside on the ground that it was ante-dated. The
basis of the order of other employees also went away
and the orders in their favour also came to an end.
19. It would be the travesty of justice to say that the
order dated 24.6.1998, is set aside as it was ante-dated
and fraudulent but the order in other matters that were
decided along with it, would still stand.
20. The matter has been sent to the Controlling
Authority by the Appellate Authority. It is pending there.
It is open to the Appellants to appear before the
Controlling Authority and get the matter decided.
21. The Appeals have no merits. They are dismissed."
7. Pursuant to the order of dismissal of Appeal by the Division
Bench, the Petitioner thereafter again appeared before the
Controlling Authority. The Controlling Authority finally vide Order
dated 28.6.2019 dismissed the claim application of Petitioner.
This Order passed by the Controlling Authority on 28.6.2019 was
subjected to challenge in an Appeal before the Appellate Authority
under the Payment of Gratuity Act and the Appellate Authority
also vide impugned Order dated 2.3.2020 (Annexure P-1) has
rejected the Appeal, leading to the filing of the present Writ
Petition."
3. Learned Single Judge, after hearing both the sides and considering
the judgments of various High Courts on the similar issues, dismissed the
writ petition (L) observing as under :-
15. Relying upon the aforesaid decisions, what is
culled out is that Executives and Non-executives form a
class separate by itself and therefore all benefits flowing
to the two categories cannot be brought at par. Non-
executives would be governed by the Agreement under
the National Joint Council for Steel Industry, whereas
the Executives under the SAIL are entitled for benefits
under the Act and the SAIL Rules on Gratuity.
16. What is also further to be seen is that the
Gratuity Act and Rules were made effective from
24.9.1997 and by that time the Petitioner already stood
retired from services and therefore he cannot claim the
advantages of the amended provisions.
17. Given the aforesaid legal position as it stands
and the judicial pronouncements made on the subject-
matter by the various High Courts on identical set of
facts, this Court is inclined to endorse the same view
taken by the various High Courts and is also inclined to
accept the fact that Non-executives since their service
conditions are based upon the NJCS agreement, the
Non-executives would be entitled for the benefits under
the NJCS agreement whereas for the Executives they
would be governed by the Steel Authority of India
Gratuity Rules and also the provisions of the Payment
of Gratuity Act both of which otherwise also prescribe
for a specific upper ceiling of Rs.1.00 Lakh. No strong
case or material has been produced before this Court to
hold that the findings arrived at by the two Authorities
below were either bad in law or illegal in any manner.
18. Given the limited scope of interference which is
permissible for the High Court under Article 226 of the
Constitution of India for interfering with an Order passed
by the Labour Courts or the Labour Tribunals or such
quasi-judicial bodies, this Court does not find any strong
case made out for holding the findings to be perverse or
without jurisdiction or in excess of jurisdiction. Neither
can the findings be held to be contrary to the service
rules and regulations governing the field.
19. Thus, for all the aforesaid, the Writ Petition fails and
is accordingly dismissed."
4. Appellant appearing in person would submit that the expression
"employee" is defined in Section 2(e) of the Payment of Gratuity Act, 1972
(henceforth "Act, 1972"), wherein, there is no classification of employees
as "Executive" and "Non-Executive" employees but respondent No. 1 /
Steel Authority of India Limited (SAIL) has classified its employees as
"Executive" and "Non-Executive" only to deprive the benefits to its
employees. It is further submitted that appellant initially joined the service
of respondent No. 1 to the post of non-executive employee but retired as
executive, thus, he served continuously with the SAIL with effect from
11.04.1958 to 31.05.1996. Thus, he has served more than two decades as
"Non-Executive", therefore, he has accrued his right to get gratuity as per
Memorandum of Agreement - National Joint Committee for Steel Industry
[MOA -NJCS] and the ceiling was not applicable to him. It has also been
contended that the provisions contained in the Act, 1972 is benevolent
legislation, therefore, provisions of the same can not be interpreted as
watertight classification. Instead thereof, it be interpreted sympathetically
towards employees. But learned Single Judge without affording due
consideration in the issue involved in the instant case, has dismissed the
writ petition, which is unsustainable in the eye of law. Therefore, he prays
to allow the writ appeal and the relief as sought for in the writ petition. He
would rely upon judgment of the Supreme Court in the matter of
Allahabad Bank & another v. All India Allahabad Bank Retired
Employees Association 1 and Jaswant Singh Gill v. M/s. Bharat
Coking Coal Ltd. & Ors. 2, to buttress his submissions.
5. Learned counsel for respondent No. 1, on the other hand, would
submit that both the authorities i.e. Controlling Authority and Appellate
Authority have taken a concurrent view and subsequently their view has
been affirmed by the learned Single Judge also. He would further submit
that appellant has been paid maximum amount of gratuity, which was
prevalent at the time of his retirement as per Section 4(3) of the Act, 1972.
Since the appellant retired from the post of "Executive", hence MOA
1 2010 (2) SCC 44
2 2007 (1) SCC 663
-NJCS agreement was not applicable to him. This issue has been
considered by the various High Courts i.e. High Court of Madhya Pradesh,
High Court of Delhi, High Court of Calcutta and High Court of Orissa. It is
further submitted that learned Single Judge, after due consideration, has
dismissed the writ petition (L) filed by the petitioner, appellant herein,
which does not call for any interference in the instant writ appeal.
6. Learned counsel for the State / respondent No. 2 adopted the
submissions made by counsel for respondent No. 1.
7. We have heard the appellant in person and learned counsel
appearing for the respondents No. 1 & 2 and perused the material
available on record with utmost circumspection.
8. In the instant case, grievance of the petitioner is the classification
between "Executive" and "Non-Executive" employee by respondent No. 1
in the matter of payment of gratuity. His further contention, is that, since
for long period, he had served as "Non-Executive", right had accrued in his
favour to get amount of gratuity as per MOA -NJCS agreement and he
can not be deprived of, from such right only because he got promoted to
the post of "Executive".
9. The aforesaid arguments advanced on behalf of the appellant in
person is not acceptable, as the respondent No. 1 is a Company duly
registered under Companies Act and it has framed its own Rules in the
matter of Payment of Gratuity to its employees, wherein it has been
provided that {Rule 2.3 (i) of Sail Gratuity Rules} the ceiling, if any, on the
total amount of gratuity payable under the Payment of Gratuity Act and
rules framed thereunder, is not applicable to non-executive employees,
who are covered under the MOA-NJCS Agreement. This rule has been
protected / permitted by Section 4(5) of the Act, 1972.
10. Respondent No. 1 has classified its employees as "Executive" and
"Non-Executive". The pay structure, allowances and service conditions of
employees of "Executive Cadre" are altogether different from the pay
structure, allowances and service conditions of employees constituting
non-executive cadres. Employees of "Executive Cadre" enjoy better
allowances, more perks and more favourable service conditions, which
otherwise is not provided to "Non-Executive". Differential treatment based
on intelligible differentia is permissible under the Constitution, so long as it
has a reasonable nexus with the objective sought to be achieved in this
behalf. Only those who are similarly situated are entitled to equal
treatment. Since the class of "Executive" and "Non-Executive" employee
are altogether different, hence, an executive employee cannot claim the
same treatment which is given to the non-executive employee on account
of binding agreement between them and Respondent No. 1- Company.
One cannot have best of both the non-executive cadre and executive
cadre.
11. When an employee is promoted from "Non-Executive Cadres" to
"Executive Cadres", then they knew that they will get all benefits
admissible to the "Executive" and have to left benefits like gratuity as per
the statutory entitlement, and therefore, claim of such "Executive" like
appellant for the same gratuity, which is payable to the "Non-Executive
Cadre", is not acceptable in the eye of law.
12. We are not impressed by the contention of the appellant appearing
in person, that since provisions contained in Section 2(e) of the Act, 1972
does not differentiate the employees as "Executive" and "Non-Executive",
therefore, such classification made by respondent No. 1 is illegal and bad
in law. Such classification has been made by respondent No. 1 based
upon MOA -NJCS agreement between it and Union representing the "Non-
Executives" and that agreement does not include "Executives". Therefore,
MOA-NJCS agreement is not applicable to the "Executive" employees of
13. Although different treatment is being meted out by respondent No. 1
to its employees i.e. "Executive" and "Non-Executive", but such a
differential treatment is not without any authority of law and is expressly
permitted under Section 4(5) of The Act, 1972. The virus of Section 4(5) of
the Act, 1972 and agreement between the respondent No. 1 and its "Non-
Executive Employees" has not been challenged by the appellant, and
therefore, such differential treatment cannot be termed as illegal. On the
facts and circumstances as discussed above, case laws cited by the
appellant appearing in person is not applicable in the instant case
because the facts of those case were pertaining to the Bank Employees,
who have their own gratuity rules.
14. Sub-section 1 of Section 4 of the Act, 1972 provides that gratuity
shall be payable to an employee on the termination of his employment;
Sub-section 2 of Section 4 provides that gratuity to an employee shall be
payable at the rate of fifteen days' wages based on the rate of wages last
drawn by the employee. Thus, gratuity is payable on the termination of the
employment of employee as provided in Section 4(1) and amount of
gratuity shall be calculated on the rate of wages last drawn by the
employee. The aforesaid provisions of law specifically goes to show that
earlier position / status of an employee is not taken into consideration for
grant of gratuity. In other words, for grant of gratuity, his last status / cadre
and last wages drawn by the employee will have to be taken into
consideration for grant of gratuity amount.
15. In view of the aforesaid discussion, we do not find any merit in the
instant writ appeal, warranting interference in the impugned order passed
by the learned Single Judge.
16. Consequently, the writ appeal, being devoid of substance, is liable to
be and is hereby dismissed. No cost.
Sd/- Sd/-
(Arup Kumar Goswami) (N.K.Chandravanshi)
Chief Justice Judge
Dubey/-
