Managing Jk Pcc And Another vs Ghulam Nabi Rather And Another
2021 Latest Caselaw 1561 j&K/2

                                     5




     HIGH COURT OF JAMMU & KASHMIR AND LADAKH
                    AT SRINAGAR



                                                   OWP No. 277/2015

                                                   Reserved on : 25.11.2021
                                                   Pronounced on: 03 .12.2021

Managing JK PCC and another
                                                             .....petitioner(s)

                         Through :- Mr. M.A.Chashoo AAG


                V/s

Ghulam Nabi Rather and another                      .....Respondent(s)
                      Through :- Mr. Gul Ayaz, Advocate

Coram: HON'BLE MR. JUSTICE SANJEEV KUMAR, JUDGE

                           JUDGMENT

1 Order dated 16.08.2014 passed by the Controlling Authority

under Payment of Gratuity Act, 1972 [„Act of 1972‟], Srinagar in File

No. 62-PG titled "Gh. Nabi Rather vs. Managing Director, JKPCC Ltd.

Srinagar" is subject matter of challenge in this petition filed by the

petitioners under Section 226 of the Constitution of India. Vide order

impugned dated 16.08.2014, the Controlling Authority under the Act of

1972, has allowed the claim of respondent No.1 (the employee) for

payment of balance gratuity to the tune of Rs.2,69,872/- against the

petitioners herein. The employee retired on superannuation as Manager in

the JKPCC Ltd. (the employer) on 30.04.2012 after rendering 28 years and

five months service.

2 It was contended by the employee in his application filed

before the Controlling Authority, that he, on retirement, became entitled to

OWP No. 277/2015

a sum of Rs.7,02,595/- as gratuity, but the JKPCC Ltd-the employer

sanctioned only a sum of 4,76,761/- leaving balance of more than

Rs.2,00,000/- outstanding. Having failed to persuade the employer for

release of balance of gratuity, the employee filed an application before the

Controlling Authority under the Act of 1972. The said application was

contested by the employer. In the objections filed by it, it was contended

that the employee, on retirement, became entitled to a sum of Rs.4,76,761/-

in terms of Rule 5 of the Gratuity Rules of JK PCC and the same was

released in his favour after fulfilling all the codal formalities. It was

pleaded that respondent No.1-employee retired on superannuation on

30.04.2012 and accepted the gratuity as was paid to him without any

protest and, therefore, he was not competent in law to file an application

before the Controlling Authority, that too, after more than two years. In

essence, the employer took a stand that the employee, in the matter of

payment of gratuity, was governed by the Gratuity Rules of JK PCC and

not by the Act of 1972 and the Rules framed thereunder.

3 The application of the employee was adjudicated upon by the

Controlling Authority and vide order impugned, the Authority allowed the

claim of the employee and held him entitled to payment of balance amount

gratuity to the tune of Rs.2,69,872/-. The Controlling Authority considered

the explanation tendered by the employee for lodging claim beyond

limitation period of 90 days and condoned the same. The Controlling

Authority also found the employee governed by the Act of 1972 and the

Rules framed under. Relying upon Section 14 of the Act of 1972, the

Controlling Authority held that the Act of 1972 had overriding effect on

any other legislation, policy, decision or rules of the employer. It is this

OWP No. 277/2015

order of the Controlling Authority which is assailed before me in these

proceedings.

4 Impugned order is challenged by the employer, inter alia, on the

ground that the employer i.e JK PCC Ltd., does not come under the

purview of the Act of 1972 and, therefore, the gratuity of its employees is

governed by the Gratuity Rules of JK PCC. It is contended that the

employee having accepted the appointment in JK PCC Ltd., shall be

deemed to have accepted the Rules and the Regulations of JK PCC Ltd.,

governing his service conditions. It is also contended by Mr. Chashoo,

learned AAG that the claim filed by the employee beyond statutory period

of 90 days was not properly explained and, therefore, the Controlling

Authority was not correct in condoning the same, that too, without giving

any reasons.

5 Per contra, it is contended by learned counsel for the employee that

the order passed by the Controlling Authority is appealable before the

Appellate Authority constituted by the Government and the appeal is

required to be preferred within a period of 60 days. The employer, without

availing of statutory and equally efficacious remedy, has rushed to this

Court by invoking extraordinary writ jurisdiction vested in this Court by

Article 226 of the Constitution of India.

6 Having heard learned counsel for the parties and perused the record,

I do not find any legal infirmity or invalidity in the impugned order of the

Controlling Authority. I am also of the considered view that the employer

has not made out a case for exercise of extraordinary writ jurisdiction

vested in this Court by Article 226 of the Constitution of India in the face

of availability of alternative statutory and equally efficacious remedy

available by way of appeal under Section 7(7) of the Act of 1972. It is not

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the case of the petitioners-the employer that the order passed by the

Controlling Authority was in violation of principles of natural justice or

had violated the fundamental rights of the employer. On this count only,

this Court could have dismissed the writ petition, however, since this

petition is pending in this Court since the year 2015 and the parties have

also argued the matter on merits, I deem it appropriate to put quietus on the

controversy.

7 The plea raised by learned counsel for the employer that JK

PCC Ltd., is not covered under the Act of 1972, is clearly afterthought. As

per own showing of the employer, the provisions of the Act of 1972 have

been extended to and adopted by JK PCC Ltd. from time to time. The

employee has placed on record a copy of order No.8 of 2007 dated

01.09.2007 which provides for enhancement of retirement gratuity in

favour of the employees of JKPCC ltd., under Rule 5 (ii) of Chapter IX of

J&K PCC Employees Service Rules and Regulations and in terms of the

provisions of the Act of 1972. It may be true that the employer has its own

Gratuity Rules, but the employer has made it a point to update its Rules so

as to bring them in tune with the Act of 1972. It is, therefore, not available

to the employer to contend that the gratuity to its employees is not

governed by the Act of 1972. Otherwise also, having regard to Section

1 (3)(b) of the Act of 1972, the said Act applies amongst others to every

shop or establishment within the meaning of any law for the time being in

force in relation to shops and establishments in a State in which ten or more

persons are employed, or were employed, on any day of the preceding

twelve months. In the State of Jammu and as it then was, the term "shop

and commercial establishment" was defined in the J&K Shops and

Establishment Act, 1966 [„Establishment Act‟].

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8 As per Section 2(4) of the Establishment Act, the term

"commercial establishment" means an establishment which carries on any

business, trade or profession or any work in connection with, or incidental

or ancillary to any business trade or profession and includes:

"(a) an establishment which carries on the business of advertising, commission agency, forwarding or commercial agency, or which is a clerical department of a factory or of any industrial or commercial undertaking;

(b) an insurance company, joint stock company, bank, brokers office and exchange, but does not include factory, shop, residential hotel, restaurant, eating house, theatre or other place of public amusement or entertainment".

9 From a reading of Section 1 (3)(b) of the Act of 1972 along

with Section 2(4) of Establishment Act, it is crystal clear that JK PCC

which undertakes construction activity on behalf of the State clearly falls

within the meaning of term "establishment" as used in Section 1(3)(b) of

the Act of 1972. The Controlling Authority has, thus, taken a correct view

in the matter. I am also at one with the Controlling Authority insofar as it

relies upon Section 14 of the Act of 1972 to hold that the Act had

overriding effect on any other legislation, policy, order or rules. For facility

of reference, Section 14 of the Act of 1972 is reproduced hereunder:

"14. Act to override other enactments, etc.- The provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act."

10 In view of clear provisions of Section 14 of the Act of 1972, it

cannot be contended by the employer that its employees including

respondent No.1 herein was governed by the Gratuity Rules of JK PCC

Ltd. and not by the provisions of the Act of 19742. Insofar as the plea of

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the employer with regard to condonation of delay is concerned, the

Controlling Authority has applied its mind to the facts and circumstances

explained by the employee in lodging belated claim and this Court does not

see any justification to interfere with the findings of fact returned by the

Controlling Authority. Otherwise also, having regard to the object of the

Act of 1972 and the beneficent nature of its provisions, the Court ought to

consider the delay more liberally.

11 Having found the impugned order not vitiated on any count,

particularly the grounds urged by the employer, I find a little error having

crept in while calculating the total gratuity payable to the employee.

Admittedly, the employee has served the employer for a period of 28 years

and 5 months and his last pay drawn was Rs.43,494/-. In terms of Section

4(2) of the Act of 1972, the employee was entitled to receive gratuity, on

superannuation, equivalent to 15 days‟ wages for each completed year of

service or part thereof in excess of six months. If that be the principle, the

employee was entitled to receive gratuity i.e., 50% of the last pay drawn

multiplied by number of completed years of service. Thus, the amount of

gratuity would come to Rs.6,08,916 (Rs.43,494÷2x28). The employee has

already received gratuity of Rs.4,76,761/- at the time of his superannuation

and, therefore, the balance amount of gratuity outstanding would come to

Rs.1,32,155 (Rs.6,08,916-Rs.4,76,761). Accordingly, the impugned order,

though upheld on merits, is corrected to the aforesaid extent and the

employee i.e., respondent No.1 herein is held entitled to balance amount of

gratuity of Rs.1,32,155/-along with interest @ 9% per annum w.e.f

01.06.2012 to 31.07.2014 and from 01.08.2014 till the amount was

deposited with the Registry of this Court. Thereafter the employee i.e

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respondent No.1 herein shall be entitled to interest earned on the amount

deposited by the Registry of this Court in the shape of FDR.

Disposed of in the above terms.

Registry shall release the aforesaid amount after proper

verification/identification in favour of respondent No.1. The Managing

Director, JK PCC Ltd. is at liberty to withdraw the excess amount, if any,

deposited by him before the Registry.

Record be sent back to the Controlling Authority.

(SANJEEV KUMAR) JUDGE Srinagar 03 .12.2021 Sanjeev PS

Whether the order is speaking : Yes Whether the order is reportable :Yes/No