Jharkhand High Court
The Project Officer vs Union Of India on 20 March, 2023
IN THE HIGH COURT OF JHARKHAND AT RANCHI
W.P. (C) No. 1527 of 2005
The Project Officer, Bachra Project, M/s. Central Coalfields Limited
P.O. Bachra, District-Chatra ... ... Petitioner
Versus
1. Union of India
2. Assistant Labour Commissioner (Central) Ranchi-cum-Controlling
Authority under the Payment of Gratuity Act, 1972 E-191/Sector,
H.E.C. Colony, P.O. Dhurba, District-Ranchi
3. The Regional Labour Commissioner (Central) Dhanbad and
Appellate Authority under the Payment of Gratuity Act, 1972
4. Smt. Zeera Devi, W/O Late Chandra Kumar Singh, Ex-UDC of
Bachra Colliery M/s. Central Coalfields Limited, At Bachra
Colliery, P.O. Bachra, District-Chatra
... ... Respondents
---
CORAM :HON'BLE MRS. JUSTICE ANUBHA RAWAT CHOUDHARY
---
For the Petitioner : Mr. A.K. Das, Advocate
Ms. Swati Shalini, Advocate
For the Respondents : None
---
15/20.03.2023 Heard Mr. A.K. Das, learned counsel appearing on behalf of the
petitioner along with Ms. Swati Shalini, Advocate.
2. Nobody appears on behalf of the respondents.
3. This writ petition has been filed for the following reliefs:-
"That the instant writ application is for the issuance of a writ of or in
the nature of certiorari or any other appropriate writ, order or
direction for quashing the Appellate order dated 27. 12. 2004
(Annexure-7) passed by the Appellate Authority (Respondent No. 3)
and the Order dated 30. 04. 2004 passed by the Respondent No.
2(Annexure-5) whereby and whereunder the claim of the Respondent
No. 4 relating to payment of Gratuity to her deceased husband, who
had been dismissed from service on 15. 06. 90 and despite specific
direction to handover possession of quarter, had continued to occupy
the quarter which was ultimately vacated after 8 years that on 19. 10.
2001 has been allowed holding with the adjustment of penal rent of
the quarter by the Central Coalfields Limited, is unauthorised and
accordingly a direction has been issued for payment of the Gratuity
Amount of Rs.43,604.40 with interest @6% from the date of filing of
the application in Form „N‟; as also for the issuance of such other
writ, order or direction as may appear just and proper for doing
equitable justice to the petitioner."
Arguments of the petitioner.
4. Learned counsel for the petitioner submits that the husband of
the petitioner was dismissed on 15.06.1990 and thereafter he died on
26.06.1993. He further submits that the matter regarding dismissal of
the husband of the petitioner was subject matter of arbitration and an
award dated 14.02.1997 was passed wherein it was observed that there
were some illegalities in the matter of termination but the learned
Arbitrator did not choose to reinstate the husband of the petitioner,
rather directed for payment of gratuity by calculating one month's
salary for each year till his age of superannuation.
5. The learned counsel submits that thereafter a petition was filed
before the Authority under Payment of Gratuity Act and the specific
case of the petitioner before the Authority was that the petitioner is
entitled for penal rent for the period the private respondent had
retained the quarter. He has relied upon a judgment passed by the
Hon'ble Supreme Court reported in (2001) 6 SCC 596 (Wazir Chand
versus Union of India and Others) and he submits that the penal rent
is adjustable against death cum retiral dues. He has also relied upon a
judgment passed by this court passed in L.P.A. No. 15 of 2013 and
submits that this court has upheld the power of the Authority to deduct
penal rent from the payable gratuity amount.
6. Learned counsel has also submitted that a notice dated
21.09.2001 was issued to the private respondent quantifying the penal
rent as Rs. 1,78,160/- stating that the same was adjustable against the
gratuity payable to the husband of the private respondent and she was
directed to evict the quarter. Learned counsel has also relied upon one
more judgment passed in the case of Project Officer versus Regional
Labour Commissioner, Central in W.P. (C) No. 2178 of 2006
decided on 23.07.2012 wherein this court while referring to the
aforesaid judgment passed by the Hon'ble Supreme Court in the case
of Wazir Chand has held that the employer is at liberty to adjust the
penal rent due to the employee for the period of unauthorized
occupation of his quarter from the outstanding post retiral dues of the
employees gratuity amount. Learned counsel has relied upon another
judgment reported in (2005) 5 SCC 245 para No. 17 , to submit that
there is a right to effect recovery of dues from any officer without his
consent from gratuity.
7. Learned counsel for the petitioner has submitted that there are
two points involved in the present case. Firstly, once the employee
was terminated, no gratuity at all was payable and secondly if any
amount was payable the penal rent was adjustable. Operative portion
of the award as quoted in para 8 of the writ petition is as under: -
"The workman concerned cannot claim reinstatement in service
with any consequential benefits. However, in case, person concerned
have not been paid the Gratuity by the management they should pay
their Gratuity. But, since the procedure adopted in the Disciplinary
Action are not being fully correct, the concerned workmen are entitled
to some reliefs. Accordingly, we direct the management to pay a sum
of rupees equivalent to one Month‟s pay per Year of service from the
date of dismissal of each aforesaid concerned workmen till their
actual date of superannuation on attaining the age of 60 Years or the
date of death, whichever is earlier at the rate of gross pay drawn by
them immediately prior to their dismissal."
This is our Award."
8. However, during the course of argument, learned counsel has
fairly submitted that the order passed by the Authority under Payment
of Gratuity Act, which was subject matter of appeal in Annexure-7
and is impugned order has not been filed in the present proceedings
nor the award which was passed on 14.02.1997 has been filed for
perusal and consideration of this court. It is further not in dispute that
upon perusal of annexure-2 dated 21.09.2001, there is no reference of
any earlier notice issued to the private respondent or her husband to
evict the quarter. It simply says that penal rent is to be adjusted as the
husband of the petitioner was terminated w.e.f. 15.06.1990 and the
quantum of penal rent was assessed for the period from 15.06.1990 to
15.09.2001 and it was also mentioned that if the private respondent
did not vacate the quarter, the appropriate steps would be taken under
the provisions of Public Premises (Eviction of Unauthorized
Occupants) Act, 1971. Admittedly, as per the records no proceeding
was initiated under the provisions of Public Premises (Eviction of
Unauthorized Occupants) Act, 1971 and the private respondent had
evicted the quarter on 19.10.2001.
Findings of this court
9. It is not in dispute that the husband of the private respondent
was in the service of the petitioner who was dismissed from service on
15.06.1990. The dismissal letter is dated 15.06.1990 which also
contained direction to vacate the company's quarter within 15 days
failing which steps were to be taken to enforce the right of the
petitioner in an appropriate manner as admissible in law and with a
further rider that the dues will be settled when commitments have
been checked. He expired on 26.06.1993 without getting gratuity
amount. The operative portion of the order of dismissal is quoted as
under:-
"Sri Chandra Kumar Singh, UDC, DG, Sct. Ashok Area,
Bachra is hereby advised to return any articles or property of
CCL in his possession to Project Officer, DG Set, Ashok
Area, Bachra and handover vacant possession of the quarter
under his occupation to Asstt. Security Officer, Bachra,
within 15 days of issue of this order. If he fails to do so, steps
will be taken to enforce the rights of CCL against him in this
respect in an appropriate manner as admissible under law.
His dues will be settled when his commitments have been
checked."
10. Thus, the consequences of failure to vacate the quarter
including that the dues of the husband of the petitioner were to be
settled when his commitments have been checked was apparent from
the order of dismissal.
11. The order of dismissal of the husband of the petitioner along
with other persons was subject matter of arbitration which resulted in
an award passed by joint arbitrators on 14.02.1997 . The award also
mentioned about the entitlement of the employees/ deceased
employees. The order of dismissal clearly mentioned about direction
to vacate the quarter within 15 days and also the consequences of not
abiding by such direction but the award was completely silent on this
point. Upon perusal of the operative portion of the award as quoted
above it appears as follows: -
i. The workman concerned cannot claim reinstatement in service
with any consequential benefits.
ii. In case, person concerned was not paid the Gratuity by the
management they should pay their Gratuity.
iii. Since the procedure adopted in the Disciplinary Action were
not fully correct, the concerned workmen were held entitled to
some reliefs.
iv. The management was directed to pay a sum of rupees
equivalent to one Month‟s pay per Year of service from the date
of dismissal of each workman till their actual date of
superannuation on attaining the age of 60 Years or the date of
death, whichever was earlier at the rate of gross pay drawn by
them immediately prior to their dismissal.
12. The award has not been filed with the writ records. However
considering the order of dismissal of the husband of the petitioner it is
clear that dismissal order mentioned about dismissal as well as
vacation of quarter and also consequences of not abiding with such
direction but the award is completely silent with regard to vacation of
quarter / recovery of penal rent etc. It is also not clear as to whether
the petitioner had ever raised any such issue before the learned
arbitrator though the letter of dismissal covered dismissal as well as
vacation of quarter. The fact also remains that the award on the one
hand held that the workmen cannot claim reinstatement in service with
any consequential benefits and also held that the procedure adopted in
the Disciplinary Action were not fully correct, the concerned
workmen were held entitled to some reliefs i.e
- gratuity and,
- one Month's pay per Year of service from the date of
dismissal till actual date of superannuation or the date of
death, whichever was earlier.
13. The aforesaid award neither contained any direction to evict
the quarter nor contained any direction to adjust or realize the penal
rent right from the date of order of dismissal i.e 15.06.1990.
Accordingly, the argument of the petitioner that they were entitled to
adjust penal rent from the date of dismissal i.e 15.06.1990, is devoid
of any merit.
14. The very fact that procedural illegality was found in the matter
of dismissal and the employees having retired/deceased, were granted
appropriate relief in terms of gratuity and also some pay till date of
death /superannuation, it cannot be said that continuation of
occupation of quarter beyond the date of dismissal i.e 15.06.1990 was
illegal and the liability to pay penal rent stood from 15.06.1990 stood
admitted and was realizable by way of adjustment from gratuity.
Considering the nature of award, it cannot be held that the penal rent
sought to be realized was an admitted amount.
15. After evicting the quarter, the private respondent filed
application in Form-N before the Controlling Authority on 11.12.2003
for getting gratuity amount of her late husband in terms of the arbitral
award dated 14.02.1997 and also claimed interest. The authority under
the provisions of Payment of Gratuity Act directed for payment of
gratuity in terms of the award and also interest on payment of gratuity
w.e.f. 14.02.1997 i.e. from the date of arbitral award, though the
application in form-N was filed only on 11.12.2003. No direction was
issued for adjustment of rent/penal rent from the payable amount of
gratuity.
16. The petitioner filed appeal before the appellate authority on the
ground that controlling authority under the Payment of Gratuity Act
had condone the delay in filing application without giving any reason
and had also allowed interest w.e.f. 14.02.1997 i.e. from the date of
arbitral award whereas the application was filed in form-N only on
11.12.2003. Further grievance of the petitioner before the appellate
authority was that the private respondent was in unauthorized
occupation of the company's quarter till 2001 and was accordingly
entitled to adjust penal rent from the payable amount of gratuity which
exceeded the payable amount of gratuity and as such the private
respondent was not entitled for any amount.
The Appellate Authority formulated the point for determination in
paragraph 7 of the impugned order as "whether the appellant
employer is authorized to deduct house rent from the gratuity amount
of the respondent and whether interest on delayed payment is
admissible". The impugned order reflects from para 8 that the present
petitioner had filed a written statement dated 06.07.2004 wherein it
was submitted that the respondent was entitled for payment of gratuity
of her late husband as per the arbitral award even then the gratuity
amount was not paid on the ground of non-vacation of company's
accommodation as well as deduction of penal rent.
The appellate authority recorded a finding that the respondent's
entitlement to receive gratuity of her late husband as per the
arbitration award was without any recovery and it could not be linked
with the vacation of company's quarter and that the employer was not
authorized to deduct/recover any dues from gratuity amount which
was protected under section 13 of the Payment of Gratuity Act from
attachment in execution of any decree or order of any civil, revenue or
criminal court. Ultimately the appellate authority held that as per sub
section 3(A) of Section 7 of the Act, the employee or his legal heir is
entitled to receive interest on the delayed payment of gratuity and held
that private respondent being the wife of the late employee was
entitled to receive interest on the gratuity amount only from the date
of submission of application in form-N i.e. from 11.12.2003 to the
date of deposit of the amount by the employer before the appellate
authority while filing the appeal. The appellate authority accordingly
modified the order passed by the controlling authority and held that
the respondent was entitled to the gratuity amount of Rs. 43,604/- as
determined by the controlling authority vide decision dated
24.04.2004 along with the simple interest @ 6% per annum from the
date of filing the application in form-N i.e. 11.12.2003 to 16.07.2004
which came to Rs. 1556 and the private respondent was entitled to a
total sum of Rs. 45,160/-.
17. The petitioner has relied upon para 17 of the judgment passed
in the case reported in (2005) 5 SCC 245 (supra), wherein Regulation
5 of Oil and Natural Gas Commission Act, 1959 has been quoted and
considered. Regulation 5 clearly provided that the Commission had
the right to recover dues before payment of gratuity dues even without
obtaining consent. The Hon'ble Supreme Court held that the
Regulation 5 left no room for doubt that the Commission has the right
to effect recovery of its dues from any officer without his consent
from gratuity. It was also recorded that the regulation has the force of
law.
In the present case, no such regulation or provision of law has been
brought on record either before the authorities under the Payment of
Gratuity Act or even before this Court enabling the respondent to
recover penal rent from the gratuity payable to the wife of the
employee or even the employee. This is over and above the fact that in
the instant case direction for payment of gratuity was issued in terms
of the award. The said judgement relied upon by the petitioner does
not help the petitioner in any manner what so ever.
18. So far as the judgment passed in L.P.A. No. 15/2013 (Bokaro
Steel Limited vs. Shri Ram Naresh Singh) decided on 24.01.2014 is
concerned, the same is clearly distinguishable from the facts and
circumstances of this case. In the said case, while framing the question
for consideration, it has been recorded in paragraph 11 that the fact of
the case was that the respondent had offered the gratuity amount as
security deposit for retaining the quarters after retirement and the
question falling for consideration in the appeal was whether the
respondent can claim payment of the gratuity as a matter of right.
Thus, the gratuity amount itself was offered as a security. Further in
the said case a proceeding under Sections 5 and 7 of the Public
Premises (Eviction of Unauthorized occupants) Act, 1971 was decided
and consequently the estate officer had not only passed an order of
eviction, but also quantified the damages. Thus, the damages in former
penal rent etc. was already adjudicated, quantified and crystalized. In
this background, the direction issued by the learned Single Judge of
this Court, directing payment of entire gratuity amount with interest
without deducting penal rent, was set aside.
19. In Wazir Chand v. Union of India (supra) , the factum of
unauthorized occupation of quarter and that the penal rent was
payable as per rules was not in dispute . In such background the
Hon'ble Supreme court did not interfere with adjustment of penal rent
while paying gratuity. The Court observed that the appellant having
unauthorizedly kept the government quarters was liable to pay penal
rent in accordance with rules and there was no illegality in adjusting
those dues against death-cum-retirement benefits.
20. The judgement of Wazir Chand (supra) also does not apply to
the facts of this case. In the present case the order of dismissal dated
15.06.1990 also contained a direction to evict the quarter and upon
failure, steps were to be taken to enforce the right of CCL and dues
was to be settled when commitments were checked. The order of
dismissal containing the aforesaid stipulation of eviction of quarter
was subject-matter of consideration in an arbitration, wherein an
award dated 14.02.1997 was passed and as per the award, the private
respondent was entitled for certain amount of salary of her late
husband till the date of superannuation or till the date of death
whichever was earlier and there was also a direction to make payment
of gratuity in terms of the said award. Admittedly, the private
respondent evicted the quarter on 19.10.2001 and thereafter filed a
petition to realize the gratuity amount as per the arbitration award. The
award did not direct for any adjustment or recovery of any penal rent
or recovery of any dues. The appellate authority while passing the
impugned order has acted in terms of the award.
21. This court does not find any illegality or perversity in the
impugned appellate order directing payment of gratuity in terms of the
arbitral award with interest from the date of application and
consequently refusing to deduct penal from the gratuity amount. The
impugned order passed by the appellate authority does not call for any
interference under writ jurisdiction.
22. Accordingly, the present writ petition is dismissed.
(Anubha Rawat Choudhary, J.)
Binit
