Morbi Municipality Through Chief ... vs Hansaben Chaturbhai
2023 Latest Caselaw 5295 Guj

       C/SCA/7321/2023                                    ORDER DATED: 07/07/2023




             IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

               R/SPECIAL CIVIL APPLICATION NO. 7321 of 2023

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               MORBI MUNICIPALITY THROUGH CHIEF OFFICER
                                 Versus
                   HANSABEN CHATURBHAI & 1 other(s)
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Appearance:
MR DEEPAK P SANCHELA(2696) for the Petitioner(s) No. 1
 for the Respondent(s) No. 2,3
MR KRUNAL D PANDYA(3283) for the Respondent(s) No. 1
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     CORAM:HONOURABLE MRS. JUSTICE MAUNA M. BHATT

                                Date : 07/07/2023

                                     ORAL ORDER

1. The above writ petition is filed by the Morbi Municipality challenging the order of Controlling Authority and Appellate Authority under the provisions as Payment of Gratuity Act.

2. The issue involved in this petition is similar to the issue in Special Civil Application No. 7305 of 2023, except the facts relating to the service particulars of the respondent - workman. Since the issue involved and the challenge is similar as that of Special Civil Application No. 7305 of 2023, the facts in the individual petitions are not referred here under.

3. The contention of the petitioner is this petition is, despite directions of remand, the Controlling Authority as well as the

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Appellate Authority have not considered the issue in accordance with directions and the provisions of the Act. This Court in Special Civil Application No. 7305 of 2023 in judgment dated 07.07.2023, has decided the similar issue as under: -

"5. Considered the submissions. In the opinion of this Court the Petition does not require consideration on the following grounds:

-

(i) The order dated 20.12.2021 in Special Civil Application No. 2225 of 2021 and allied matters, on which heavy reliance is placed by learned advocate for the Petitioner does not refer to straightway application of the factual data referred by the Petitioner. The operative portion of the order reads as under: -

"9. The impugned order passed by the Controlling Authority as well as the order passed by the Appellate Authority are hereby quashed and set aside. The matters are remanded back to the Controlling Authority to decide afresh. It will be open for either of the parties to provide the details with regard to the appointment of the respondent-workmen as daily wagers and their respective dates of absorption or confirmation. The Controlling Authority shall pass appropriate orders with regard

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to their entitlement as per the provisions of the Payment of Gratuity Act from the dates of their engagement as daily wagers till the date of their regularization. Such order shall be passed within a period of three months from the date of receipt of this order

(ii). The above observation, in opinion of this court, is made in the context of the facts recorded in para 7 and 8 of the very same judgement, in Special Civil Application No. 2225 of 2021, which reads as under;

"7. The aforesaid chart reveals that all the workmen had initially worked as daily wagers and after rendering particular number of years service (seven years or ten years), they were regularised and made permanent. It is not in dispute that the petitioner-Municipality has paid gratuity as per the provisions of the Gujarat Civil Services Rules, 2002 for the period for which they have rendered their services as a regular employees. Thus, the date from the workmen till they had retired, the Municipality had paid gratuity amount as per the provisions of Gujarat Civil Services Rules, 2002. The same is not denied.

However, the dispute pertains to awarding of gratuity to the workmen prior to they have been regularised in service and for the service on which they are engaged as

C/SCA/7321/2023 ORDER DATED: 07/07/2023

daily wagers....

XXXX

8. The Division Bench has confirmed the judgment and order passed by the Single Judge Bench and clarified that the employees are entitled to gratuity under the Payment of Gratuity Act, also for the period they worked as daily wagers till they are made permanent, and thereafter they would be entitled for the gratuity under the provisions of the Gujarat Civil Service (Pension) Rules, 2002 after they have made permanent. Since the facts or data with regard to the appointments of the respondent-workmen and the date of their regularization was not placed before the Controlling Authority, it would be appropriate that these matters are remanded back to the Controlling Authority for deciding afresh, in the light of the observations made by this Court."

(iii) Thus, this court recorded the fact that, it is not in dispute that the Petitioner- Municipality has paid gratuity as per the provisions of the Gujarat Civil Service Rules, 2002, for the period the respondent workman rendered services as regular employee. However, the dispute pertains to awarding of gratuity to the workman for the period prior to their regularization of service and for the

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service when the Respondent was engaged as daily wager. Therefore, with the remand to the controlling authority, opportunity was given to both the parties to provide the details with regard to the appointment of the respondent- workman as daily wager and the respective dates of absorption or confirmation.

(iv) Reading of the decision dated 20.12.2021, it is clear that this Court no where directed the straight application of data as referred in para 5 of the said judgment. Therefore, I do not see any error in the findings recorded by both the authorities in their orders, that despite opportunities no data other than the data provided by the respondent-workman, for the date of joining as daily wager was produced or available.

(v). Most importantly, in the decision of this court in Special Civil Application No. 2225 of 2021, after placing reliance on the decision in Letter Patent Appeal No. 1195 of 2017, it is held as under:

"9. Having considered the judgement rendered in Letters Patent Appeal No. 1195 of 2017, relevant portion of which is reproduced hereinabove, we are of the opinion that the view taken by the Controlling Authority and confirmed by the Appellate Authority as well as the learned Single Judge do not require interference.

C/SCA/7321/2023 ORDER DATED: 07/07/2023

The provisions of the Payment of Gratuity Act make no distinction between a regular employee and a daily wager. There is no specific provision that daily wagers are not entitled to the payment of gratuity. Considering the provisions of the Payment of Gratuity Act, 1972 particularly Sections 3 to 5 and 14, it can very well be seen that the provisions of the Act shall have effect notwithstanding anything inconsistent with any other enactments. The submission therefore made by learned counsel for the respective appellants that once having earned the gratuity under the relevant provisions of Gujarat Civil Service (Pension) Rules, 2002, the period rendered prior to such regularization and claimed under such rules would disentitle such employee from claiming gratuity under the Gratuity Act as a daily wager cannot be sustained.""

(vi) It may be of relevance to refer to the definition of Employee under Section 2(e) which reads as under:

"2. ....

(e) "employee" means any person (other than an apprentice) employed on wages, 4 [***] in any establishment, factory, mine, oilfield, plantation, port, railway company or shop to do any skilled, semi-skilled, or unskilled, manual, supervisory, technical or

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clerical work, whether the terms of such employment are express or implied, 5 [and whether or not such person is employed in a managerial or administrative capacity, but does not include any such person who holds a post under the Central Government or a State Government and is governed by any other Act or by any rules providing for payment of gratuity]"

(vii) Under section 4, Gratuity shall be payable to an employee after he has rendered continuous service for not less than 5 years. Section 4 of the of the Act reads as under: -

"4. Payment of gratuity.

(1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years, -

(a) on his superannuation, or

(b) on his retirement or resignation, or

(c) on his death or disablement due to accident or disease:

Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment

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of any employee is due to death or disablement:

Provided further that in the case of death of the employee, gratuity payable to him shall be paid to his nominee or, if no nomination has been made, to his heirs, and where any such nominees or heirs is a minor, the share of such minor, shall be deposited with the controlling authority who shall invest the same for the benefit of such minor in such bank or other financial institution, as may be prescribed, until such minor attains majority.]

(2) For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days wages based on the rate of wages last drawn by the employee concerned:

Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account.

Provided further that in the case of [an employee who is employed in a seasonal establishment and who is not so employed

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throughout the year], the employer shall pay the gratuity at the rate of seven days wages for each season."

Therefore, neither under Section 2 nor Section 2(a), any distinction is drawn between the temporary employee or a permanent employee. Continuous service is required for a period as uninterrupted service. Therefore, even under Section 4, gratuity shall be payable to an employee defined under Section 2 who has rendered continuous service defined under Section 2

(a) without any distinction.

(viii) Thus, as per section 4(1), the employee is to be paid gratuity upon completion of five years of service, in case of the contingencies referred in clause (a), (b) or (c). Sub section (2) of section 4 of the Act, provides for the amount of gratuity the employer shall have to pay to the employee. The first proviso to sub section (2) of section 4 provides for computation of payment of gratuity to the piece rated employee. The second proviso to sub section (2), of Section 4, provides for computation of payment of gratuity in case of employee who was employed for seasonal work or who was not employed throughout the year.

6. In my opinion, none of the proviso to subsection (2) to Section 4, envisages different computation of payment of gratuity for daily

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wage employee. Therefore, the contention of learned counsel for the Petitioner that for daily wage employee, different computation is required is not correct. The controlling authority as well as the Appellate Authority, therefore, are correct in holding that for the period the workman was engaged as daily wager, the gratuity is to be computed under section 4 (1), of the Act. Hence, the amount paid by the Petitioner towards gratuity was deducted and balance amount was directed to be paid.

7. Therefore, there is no illegality or infirmity in the order passed by both the authorities - controlling and appellate, which warrant interference of this Court. The petition therefore deserves to be rejected, and hence is accordingly rejected with no order as to cost.

8. At this stage I would like to observe that the remarks of the appellate authority that the Municipality by one or the other litigation is trying to delay the payment of gratuity to the respondent, appears to be correct."

4. Since, the issue has been decided as referred herein above, relying upon the findings therein, this petition does not require any interference and the same is rejected. No order as to cost.

(MAUNA M. BHATT,J) SHRIJIT PILLAI