Ramesh Vishnu Dalvi vs General Manager(Hrm)
2022 Latest Caselaw 6365 Guj

      C/SCA/14605/2014                                     ORDER DATED: 18/07/2022




             IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

              R/SPECIAL CIVIL APPLICATION NO. 14605 of 2014
                                  With
              R/SPECIAL CIVIL APPLICATION NO. 14563 of 2014
                                  With
              R/SPECIAL CIVIL APPLICATION NO. 10997 of 2017
================================================================
                              RAMESH VISHNU DALVI
                                     Versus
                         GENERAL MANAGER(HRM) & 3 other(s)
================================================================
Appearance:
DECEASED LITIGANT for the Petitioner(s) No. 1
MR. JIT P PATEL(6994) for the Petitioner(s) No. 1.1
MR DARSHAN M PARIKH(572) for the Respondent(s) No. 1,2,3
MR.D K.PUJ(3836) for the Respondent(s) No. 4
================================================================
 CORAM:HONOURABLE MR. JUSTICE A.Y. KOGJE

                                    Date : 18/07/2022
                                     ORAL ORDER

[1] These three petitions are arising out of the similar facts and are raising identical issues and hence, at the request of both the sides, all three matters are taken up for joint hearing and disposal. Special Civil Application No.14563 of 2014 and Special Civil Application No.14605 of 2014 are filed by the employees (for short "petitioner employees") and Special Civil Application No.10997 of 2017 is filed by the bank (for short "employer bank") against the private respondent employee who has been served and though served none has filed appearance however, by a communication addressed to the Registry, response has been forwarded which is placed on record by the Registry. The issue pertains to payment of gratuity and applicability of the settlement.

[2] Two petitions are filed by the petitioner employees against the order passed by the appellate authority under the Payment of Gratuity Act which under its order dated

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24.02.2014 was pleased to set aside the order dated 17.09.2012 passed by the Controlling Authority and Assistant Labour Commissioner, Central Government of India. The controlling authority had passed an order holding that the petitioner employees were entitled to get the gratuity after the wage revision and therefore, directed to pay the difference of amount of gratuity which was already paid prior to the wage revision and entitled to after the wage revision. The appellate authority by the impugned order set aside the order of the controlling authority by holding that the petitioner employees were not entitled to payment of gratuity on the basis of revised pay/wages as the same was already dismissed by the High Court in its oral judgment dated 12.04.2004 and 31.01.2006 respectively. Third petition filed by the employer bank which by its order dated 29.03.2017 has upheld the order of the controlling authority dated 28.09.2016 partly modifying the order. The facts however, are recorded as prayed for from Special Civil Application No.14563 of 2014.

[3] The main contention of the petitioners is that the issue is given a quietus by the Apex Court in its decision in the Civil Appeal No.1975 of 2010 in the case of Central Bank of India v/s. M. Sethumadhan and others and that the entitlement of the petitioner employees for receiving the gratuity of revised wages was considered and the Hon'ble Supreme Court has directed the bank to pay an amount of Rs.2 Lakhs in full and final settlement of all the claims including the expenses which have incurred for litigation for more than two decades.

[4] Learned advocate has thereafter referred to the judgment of this Court dated 10.10.2017 in Letters Patent Appeal No.1748 of 2005 and submitted that relying upon such

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decision of the Apex Court as mentioned hereinabove, the Division Bench had also taken the same stand and directed the bank therein to pay an amount of Rs. 2 Lakhs to concerned retired employees or heirs towards full and final settlement. Learned advocate submitted that the petitioner employees seek similar treatment.

[5] As against this, learned advocate appearing for the respondent-employer bank submitted that the decision of the Supreme Court though may be in rem, but clearly the Apex Court has passed such an order in exercise of powers under Article 142 of the Constitution of India and therefore, may not be treated as a law declared. It is submitted that in particular facts of this case, the Court still has a discretion to consider the case. Learned advocate has drawn attention of this Court to the very judgment of the Apex Court in case of M. Sethumadhan and others (Supra) and submitted that in fact in paras-6 and 8 respectively, the stand of the Gujarat High Court was approved and finding give in connection with cut-off date for applying the benefits of gratuity was also approved and therefore, petitions deserve to be dismissed.

[5.1] It is also submitted that the petitions also required to be dismissed on the ground of suppressing of facts inasmuch as before the controlling authority the petitioners have not disclosed the fact that the very issue was agitated before this Court with the similar prayer and this Court by a reasoned orders had dismissed the claim of the gratuity. Not only that but the challenge made by the employees in Letters Patent Appeal also failed. It is submitted that after the order of the LPA Bench, the petitioners had accepted such order and did not carry it any further, but straightway on the basis of a decision of the Apex Court dismissing the SLP against the order

C/SCA/14605/2014 ORDER DATED: 18/07/2022

of Kerala High Court re-agitated the issue before the controlling authority without referring to the decision in Special Civil Application and Letters Patent Appeal allowed the application. It is submitted that petitioners have not moved or challenged the issue any further after the decision of the Letters Patent Appeal or the long delay of six years has also not explained. It is also submitted that the decision of the Apex Court would even if construed liberally applied to the litigations which are pending bonafide, whereas in case of the petitioner employees, the decision was also finalized by the LPA Bench in the year 2006 and therefore, when the issue was re-agitated in the year 2012, the observation of the Apex Court M. Sethumadhan and others (Supra) cannot be made applicable. Learned advocated submitted that by accepting the claim of the petitioner-employees, the bank will have to burden the financial implications of approximately 300 employees who may stake their respective claim.

[5.2] Learned advocate has drawn attention of this Court to the observations made by this Court in Special Civil Application No.3226 of 1998 dated 12.04.2004 (2004 JX (Guj.) 148) and also common oral order dated 31.01.2006 in Letters Patent Appeal No.45 of 2005 in Special Civil Application No.3226 of 1998.

[6] In rejoinder, learned advocate for the petitioner- employees has insisted that the benefits if any would be restricted to only those cases where the petitions are pending before the High Court as per the observation made by the Supreme Court and therefore, the contention of the respondents regarding opening of claims for 300 employees may not be accepted.

       C/SCA/14605/2014                                 ORDER DATED: 18/07/2022




[7]     Heard learned advocates for the parties and perused the

documents placed on record. The petitioner of Special Civil Application No.14605 of 2014 was retired on 31.08.1993, petitioner of Special Civil Application No.14563 of 2014 was filed on 30.11.1993 and respondent of Special Civil Application No.10997 of 2014 was filed on 31.12.1993. At the relevant point of time under the provisions of Payment of Gratuity Act as they stood then, the maximum gratuity, which could be payable to the petitioner was Rs.50,000/-. The petitioner was already paid an amount higher than this amount of gratuity of Rs.50,000/-. A settlement was arrived at between the parties wherein different benefits were given from different dates. The Bank of Baroda Retired Officers' Association alongwith individuals, including petitioner of Special Civil Application No.14563 of 2014 filed Special Civil Application No.3226 of 1998 challenging the said settlement in so far as it did not grant them enhanced gratuity to retired persons like them. Petitioner of Special Civil Application No.14605 of 2014 was a member of the said association. Special Civil Application No.3226 of 1998 came to be dismissed, holding that the petitioners and all those whom the respondent, were not entitled to enhance gratuity and the settlement did not violate any provision of the Constitution of India. Thereafter, Letters Patent Appeal No.45 of 2005 filed against the order dated 12.04.2004 passed in Special Civil Application No.3226 of 1998 came to be dismissed. The petitioners and the appellants of the said SCA and LPA respectively accepted the said judgments and did not challenge any further and the said decisions became final.

[7.1] Petitioners of Special Civil Application No.14563 of 2014 and Special Civil Application No. 14605 of 2014 approached

C/SCA/14605/2014 ORDER DATED: 18/07/2022

the Payment of Gratuity Authority without disclosing the facts about dismissal of the SCA and the LPA as above, seeking additional gratuity ostensibly on the basis of an order of the Supreme Court dismissing a Special Leave Petition. Respondent of Special Civil Application No.10997 of 2017 filed claim before Payment of Gratuity Authority. The application filed by the petitioner of Special Civil Application No. 14563 of 2014 came to be allowed directing the bank to pay additional amount of gratuity. The applications filed by the petitioner of Special Civil Application No. 14605 of 2014 came to be allowed directing the bank to pay additional amount of gratuity. By an order in Appeal, the Appellate Authority, after considering the judgments of this Court in Special Civil Application No.3226 of 1998 and Letters Patent Appeal No.45 of 2005, rejected the claim made by the said petitioners of Special Civil Application No. 14563 of 2014 and Special Civil Application No. 14605 of 2014 and allowed the appeal filed by the bank in view of the judgments of this Court in Special Civil Application No.3226 of 1998 read with Letters Patent Appeal No.45 of 2005.

[8] In Special Civil Application No.3226 of 1998, one of the petitioners being a party had raised the issues which are identical to the present case and in fact, the prayer clause in Special Civil Application No.3226 of 1998 would read as under:-

"(B) Be pleased to quash and set aside the action of the respondent in not giving the gratuity to the members of the petitioner Association on the basis of their last pay drawn, who have retired from service of Respondent No.1 before 01/11/1994."

[9] While dealing with this petition, this Court in order dated 12.04.2004 has considered the relevant judgments applicable and ultimately held as under:-

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15. From the aforesaid facts of the case and the rival contentions of the parties and the Submissions of the learned Advocates, it is clear that the Members of petitioner No.1- association and petitioner No.1 have come to this Court after having retired between 1st November, 1992 and 31st January, 1994, and having received the available benefits under the Settlement. It is also clear that the petitioners have Challenged the settlement only because their expectations under Che head of gratuity were not fulfilled. The submission that the settlement is not binding to them in the first instance and in the alternative, the settlement. is not in consonance with the provisions of 'the Payment of the Gratuity Act, are not only found to be contradictory in terms, but also, without any merit. In the considered opinion of this Court, the petitioners cannot be heard to contend any of the aforesaid grounds and, therefore, the. petition fails and the same is dismissed. Rule is discharged. No order as to costs."

[10] This decision was subject matter of challenge by the petitioners through their association in Letters Patent Appeal No.45 of 2005, whereby the order dated 31.01.2006, the Letters Patent Appeal came to be summarily dismissed.

"4. Before appreciating the aforesaid contentions, we put it to Mr. Majmudar for the appellants that if they are ready and willing to return all other benefits which they have received under the settlement with interest at the rate of 9% on it, then their appeals can be considered on the point of gratuity amount paid under the settlement but Mr. Majmudar was not agreeable for it as under the settlement, they have already got much more.

5. In view of the above facts, we are now required to consider the reasoning assigned by the learned Single Judge as well as aforesaid arguments advanced by Mr. Majmudar for the appellants.

6. Having carefully gone through the judgment and order passed by the learned Single Judge and having heard learned counsel Shri Majmudar for the appellants, we are of the considered opinion that merely because their expectations under the head of Gratuity were not fulfilled, that is no ground to challenge only one part of settlement i.e. on the point of Gratuity by accepting other benefits under the very settlement.

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6.1 Secondly, there was a considerable delay on their part to approach the court seeking relief only of gratuity amount. If the learned Single Judge of this court has refused to exercise his extraordinary jurisdiction under Article 226 in favour of the appellants - petitioners on the ground of delay and laches, then certainly, on peculiar facts and circumstances of the case, we would not like to entertain these Letters Patent Appeals on this ground. Except the aforesaid arguments, no other argument was advanced by Mr. Majmudar. As stated earlier, on facts and circumstances of the case, we are not inclined to entertain all these appeals as the appellants - petitioners have already got much more amount under the settlement.

7. In view of the above discussion, all these appeals summarily fail and are hereby dismissed."

[11] It appears that the matter rested there and there was no movement on the part of the petitioner employees however, on the basis of a decision of the Apex Court in case of Syndicate Bank & Others vs. Celine Thoms and Another, the petitioners are re-agitating the issue. It would be therefore pertinent to reproduce the exact order passed by the Apex Court in the aforesaid petition.

"ORDER

We have heard learned counsel for the parties. In the facts and circumstances of the case, we are not inclined to interfere with the impugned order. The Special leave petition is, accordingly, dismissed. However, the question of the law is kept open to be decided in an appropriate case."

[12] It is appropriate to observe that while dismissing the SLP consciously the Apex Court had kept the question of law open. Based on this, the petitioner employees filed an application No.BRC/ALC/48/(5)/2012 once again claiming the gratuity on the revised wages. It is pertinent to observe that the employee had retired on 31.08.1993.

     C/SCA/14605/2014                             ORDER DATED: 18/07/2022




[13]    The controlling authority in its entire decision has not

referred to the order of this Court in Special Civil Application No.3226 of 1998 and Letters Patent Appeal No.45 of 2005 and now the petitioners are seeking to rely upon the decision of the Apex Court in case of M. Sethumadhan and others (Supra). This decesion of the apex court is pending the present petition. The relevant paras of the aforesaid decision would read as under:-

"4 Umpteen number of judgments have been cited before us for the justification and rationale behind fixation of a cut-off date. The celebrated Constitution Bench Judgment in D. S. Nakara Vs, Union of India, reported in (1983) 1 SCC 305 has been cited to finally contend that in any case, the appellants are not bound to pay the arrears even if the calculation goes in favour of the respondents.

5. We find that during the pendency of the matters before this Court, a Full Bench of the High Court of Kerala, having regard to the divergent views taken by Division Benches of the said Court, has considered this issue, leading to the Judgment dated 03.03.2016 in O,P. No.20427 of 1997 (F) along with O.P. No. 3489 of 1997 and it has been held that fixation of cut-off date for extending the benefit of gratuity from a different date as compared to revision of pay-scale can neither be said to be arbitrary, discriminatory or violative of Articles 14 and 16 of the Constitution of India. The Full Bench has also placed reliance on the decisions of this Court in State Government Pensioners' Association and Ors. Vs 3 State of Andhra Pradesh, reported in (1986) 3 SCC 501, State of A.P. Vs. A.P.Pensioners' Association, reported in (2005) 13 SCC 161 and State of Bihar VS. Bihar Petitioners' Samaj, reported in (2006) 5 SCC 65.

6. We also find that the High Court of Gujarat and Madras also have take a similar view. However, the High Court of Karnataka has taken a different view in the Judgment dated 25.05.2012 in Writ Appeal Nos. 1758-1785 of 2003 (S-RES) & other connected matters. The High Court, in the said Judgment, has taken the view that the classification adopted by the appellants will not stand the test of Article 14 and hence, a direction has been issued for disbursing the benefits with 6% interest with effect from 23.06.1995.

7. Having heard Mr. Jaideep Gupta, Mr. Dhruv Mehta and Mr. Adarsh Dial, learned senior counsel and other learned counsel

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on behalf of the appellants as well as Mr. M.K.S. Menon, learned senior counsel and other learned counsel appearing for the retired employees in other cases, we are of the view that having regard to long drawn litigation for almost a quarter of century, the issue should be given a quietus, settling the question of law but protecting the interest of the litigants in these cases.

8. Fixing of cut-off date has been a well accepted principle and we do not find that the same needs to be supported by any Judgment since it has been the consistent view taken by this Court. In State of Punjab & Ors. Vs. Amar Nath Goyal & Ors. (2005) 6 SCC 754, which was subsequently followed in Government of Andhra Pradesh & Ors. Vs. N. Subbarayudu & Ors., reported in (2008) 14 SCC 702, this Court has referred to all the judgments in that regard. In the peculiar facts of this case, having regard to the background of the regularisation making process, we are of the view that the cut-off date fixed by the appellants in the regularisation was not arbitrary, unjust or unfair.

9. However, having regard to the fact that the retired employees before this Court have been fighting for around quarter of a century and taking note of the fact that they are only a few in number, we are of the view that this is a fit case to invoke our jurisdiction under Article 142 of the Constitution of India. We, therefore, direct that the appellants Banks shall pay an amount of Rs. 2,00,000/(Rupees Two Lakhs) in full and final settlement of all their claims including the expenses which they have incurred for litigation for. more than two decades. The amount, as above, shall be paid within eight weeks from today."

[14] In the opinion of the Court, the Supreme Court in the order passed has clearly expressed in uncertain terms that the aforesaid order is passed in exercise of its powers under Article 142 of the Constitution of India unlike 141 of the Constitution of India which being the law declared by the Supreme Court to be binding on all Courts. In the opinion of the Court, the Supreme Court was mindful of exercising such powers to mean to apply only to the cases on hand, but in the opinion of the Court, will not cover the case on which there is a judicial pronouncement. In the instant case, the very issue was agitated, argued and decided by the High Court in the previous

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round of litigation, the petitioner employees had accepted the status as such in the finality of the decision, but re-agitated the same as if all decisions of this Courts are not in existence at all. In the opinion of the Court, at least by the decision of the Apex Court at Annexure-H, order passed by this Court in Special Civil Application No.3226 of 1998 and Letters Patent Appeal No.45 of 2005 cannot be said to be overruled even implidely. Over and above that, the controlling authority has completely misdirected itself by disregarding the very issue decided by this Court. In the opinion of the Court, the subsequent order in case of Syndicate Bank & Others (Supra) cannot be treated to have overruled the decision of this Court, thereby giving a new lease of life to the issue which is already decided. The Apex Court in case of R. Unnikrishnan and another v/s. V.K.Mahanudevan and others, reported in AIR 2014 SC 1201, in paras-15 and 16 has held as under:-

"15. It is trite that law favours finality to binding judicial decisions pronounced by Courts that are competent to deal with the subject matter. Public interest is against individuals being vexed twice over with the same kind of litigation. The binding character of judgments pronounced by the Courts of competent jurisdiction has always been treated as an essential part of the rule of law which is the basis of the administration of justice in this country. We may gainfully refer to the decision of Constitution Bench of this Court in the Daryao v. State of U.P. AIR 1961 SC 1457 where the Court succinctly summed up the law in the following words:

"It is in the interest of the public at large that a finality should attach to the binding decisions pronounced by Courts of competent jurisdiction, and it is also in the public interest that individuals should not be vexed twice over with the same kind of litigation.(***) The binding character of judgments pronounced by courts of competent jurisdiction is itself an essential part of the rule of law, and the rule of law obviously is the basis of

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the administration of justice on which the Constitution lays so much emphasis."

16. That even erroneous decisions can operate as res-judicata is also fairly well settled by a long line of decisions rendered by this Court. In Mohanlal Goenka v. Benoy Kishna Mukherjee AIR 1953 SC 65, this Court observed:

"There is ample authority for the proposition that even an erroneous decision on a question of law operates as 'res judicata' between the parties to it. The correctness or otherwise of a judicial decision has no bearing upon the question whether or not it operates as 'res judicata'."

[15] The reliance placed upon by the petitioners on the decision in Letters Patent Appeal No.1748 of 2005, it is pertinent to observe in para-4 that the order of paying Rs.2 Lakhs towards full and final settlement in the line of the Apex Court's decision in the case of M. Sethumadhan and others (Supra) was particularly because the bank before this Court was the same as the bank before the Apex Court in the appeal and that the aforesaid order was passed more on a consensus and therefore, will not come to the rescue of the petitioners.

[16] The principal regarding cut-off date for the purpose of payment of gratuity on revised wages was also a subject matter of consideration before the Apex Court in Civil Appeal No.197 of 2010 in case of Indian Overseas Bank v/s. The Regional Labour Commissioner and Appellate Authority and others, wherein in order dated 29.11.2018 examining the very issue held as under:-

"....The challenge to the Ordinance and the Act on the ground of violation of Article 14, i.e. cut-off date for payment of the pensionary benefits w.e.f. 01.03.1989 was repelled by this Court. In Paragraph No. 17, this Court held:-

17. ...............The only ground on which Article 14 has been put forward by the learned counsel for the respondent is that the fixation of the cut-off date for payment of the revised benefits under the two notifications concerned was arbitrary

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and it resulted in denying arrears of payments to certain sections of the employees. This argument is no longer res integra. It has been held in a catena of judgments that fixing of a cut-off date for granting of benefits is well within the powers of the Government as long as the reasons therefor are not arbitrary and are based on some rational consideration." Thus, this Court held that the fixation of date for payment of financial benefits, w.e.f. 01.03.1989, does not suffer from any infirmity, even though the effective date of the notification was fixed as 01.01.1986. The above ratio fully supports the view, which we have taken above."

[17] However, in the aforesaid judgment as the amount was already paid long back ago, the recovery was not effected.

[18] In view of the aforesaid, the Court is of the view that the controlling authority has acceded its jurisdiction in passing the order and held employees to be entitled to the gratuity subsequent to the revision of pay/wages and therefore, the order of the appellate authority in Special Civil Application No.14563 of 2014 and Special Civil Application No.14605 of 2014 is upheld.

[19] For the aforesaid reasoning, the order of the appellate authority challenging in Special Civil Application No.10997 of 2017 is ordered to be quashed and set aside.

[20] With the aforesaid, the petitions stand disposed of.

(A.Y. KOGJE, J) SIDDHARTH