Madras High Court
M/S.Coimbatore Murugan Mills vs Regional Labour Commissioner ... on 12 August, 2022
W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 12.08.2022
CORAM
THE HON'BLE MR.JUSTICE S.M.SUBRAMANIAM
W.P.Nos.32608, 32609 of 2005, 26934 & 26935 of 2015
and
M.P.Nos.1 of 2015 in W.P.Nos.26934 & 26935 of 2015
W.P.No.32608 of 2005
M/s.Coimbatore Murugan Mills,
Mettupalayam Road,
Post Box No.7004
Coimbatore – 641 043,
rep. By its General Manager ...Petitioner
-Vs-
1.Regional Labour Commissioner (Central),
Sastry Bhavan, 4, Haddows Road,
Chennai – 600 006.
2.Assistant Labour Commissioner (Central),
Sastry Bhavan, 4 Haddows Road,
Chennai – 600 006.
3.R.Sundaram ...Respondents
Prayer: Writ Petition filed under Article 226 of the Constitution of India
praying to issue a Writ of Certiorari, calling for the records of the 1st
https://www.mhc.tn.gov.in/judis
W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
respondent dated 29.07.2005 in Gratuity Appeal No.17 A of 2005
confirming the order of the 2nd respondent dated 30.04.2004 in Gratuity
Application No.62 of 2003 and quash the order dated 29.07.2005.
W.P.No.32609 of 2005
M/s.Coimbatore Murugan Mills,
Mettupalayam Road,
Post Box No.7004
Coimbatore – 641 043,
rep. By its General Manager ...Petitioner
-Vs-
1.Regional Labour Commissioner (Central),
Sastry Bhavan, 4, Haddows Road,
Chennai – 600 006.
2.Assistant Labour Commissioner (Central),
Sastry Bhavan, 4 Haddows Road,
Chennai – 600 006.
3.P.Somasundaram ...Respondents
Prayer: Writ Petition filed under Article 226 of the Constitution of India
praying to issue a Writ of Certiorari, calling for the records of the 1st
respondent dated 29.07.2005 in Gratuity Appeal No.18 A of 2005
confirming the order of the 2nd respondent dated 30.04.2004 in Gratuity
Application No.62 of 2003 and quash the order dated 29.07.2005.
https://www.mhc.tn.gov.in/judis
W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
W.P.No.26934 of 2015
The Management,
Coimbatore Murugan Mills,
A Unit of National Textile Corporation,
Mettupalayam Road,
Post Box No.7004
Coimbatore – 641 043,
rep. By its General Manager ...Petitioner
-Vs-
1.Regional Labour Commissioner (Central),
Sastry Bhavan, 4, Haddows Road,
Chennai – 600 006.
2.Assistant Labour Commissioner (Central),
(Controlling Authority under Payment of Gratuity Act),
Sastry Bhavan, 4 Haddows Road,
Chennai – 600 006.
3. M.Krishnan ...Respondents
Prayer: Writ Petition filed under Article 226 of the Constitution of India
praying to issue a Writ of Certiorari, calling for the records of the 1st
respondent dated 21.10.2014 in Gratuity Appeal No.157 of 2012 confirming
the order of the 2nd respondent dated 14.08.2012 in Gratuity Application
No.68 of 2009.
https://www.mhc.tn.gov.in/judis
W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
W.P.No.26935 of 2015
The Management,
Coimbatore Murugan Mills,
A Unit of National Textile Corporation,
Mettupalayam Road,
Post Box No.7004
Coimbatore – 641 043,
rep. By its General Manager ...Petitioner
-Vs-
1.Regional Labour Commissioner (Central),
Sastry Bhavan, 4, Haddows Road,
Chennai – 600 006.
2.Assistant Labour Commissioner (Central),
(Controlling Authority under Payment of Gratuity Act),
Sastry Bhavan, 4 Haddows Road,
Chennai – 600 006.
3.T.Sundaram ...Respondents
Prayer: Writ Petition filed under Article 226 of the Constitution of India
praying to issue a Writ of Certiorari, calling for the records of the 1st
respondent dated 21.10.2014 in Gratuity Appeal No.156 of 2012 confirming
the order of the 2nd respondent dated 14.08.2012 in Gratuity Application
No.67 of 2009.
https://www.mhc.tn.gov.in/judis
W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
[in all WPs]
For Petitioner : Mr.Haroon A.L. Rasheed
for M/s.T.S.Gopalan & Co.
For R1 & R2 : Mr.V.Ashok Kumar
Central Govt. Standing Counsel
For R3 : No Appearance
COMMON ORDER
The Writs on hand have been instituted questioning the validity of the
orders of the first respondent in Gratuity Appeal Nos.17A and 18A of 2005
dated 29.07.2005 and Gratuity Appeal Nos.157 and 156 of 2012 dated
21.10.2014, confirming the orders passed by the second respondent in
Gratuity Application Nos.62 and 63 of 2003 dated 30.04.2004 and Gratuity
Application Nos.68 and 67 of 2009 dated 14.08.2012 respectively.
2. The petitioner is M/s.Coimbatore Murugan Mills, which is a unit of
National Textile Corporation Limited. The petitioner is the manufacturer of
cotton yarn and fabrics. There was a settlement reached under Section 18(1)
of the Industrial Disputes Act between the petitioner and the recognised
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W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
Union on 23.01.1997 for the accounting year 1996-1997. As per the
settlement, it was agreed that for the employees whose monthly wages
exceed Rs.3,500/-, they would be paid an advance amount equivalent to
bonus and ex-gratia. The said amount would be paid only to those eligible
employees and the mode of adjustment of the advance payment could be
further discussed with the Union subsequently. For the accounting year
1997-1998, a notice was put up on 05.11.1999, wherein it was stated that
for the employees who were outside the coverage of Payment of Bonus Act,
they would be given advance and that the Union and the management would
make a request to the Central Government to waive repayment of advance
and if it is accepted by the Central Government, the advance amount would
not be recovered and in any event, the matter would be decided as per the
decision of the Central Government. However, by its letter dated
26.07.1999, the Central Government rejected the request for waiver of
repayment of advance amount. Thus, the petitioner management adjusted
the said amount from the gratuity amount due to the workman and more so,
after receiving their consent.
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W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
3. In view of the adjustment of the amount paid to the workers, the
third respondents herein approached the competent authority under the
Gratuity Act, who in turn, allowed their claim and the appeals filed by the
management were also rejected. Thus, the petitioner is constrained to move
these Writ Petitions.
4. The issues raised in the present Writ Petitions were considered by
this Court in the case of Kaleeswarar Mills 'A' Unit, Coimbatore Vs. The
Appellate Authority under the Payment of Gratuity Act and others passed
in W.P.No.22727 of 2005, dated 13.09.2019, wherein the following
observations are made:-
"4. The above order was passed, based on the
circumstances in an identical case where the Court has
rejected the claim of the Management in order dated
10.02.2011 in WP.No.32319 of 2004. The observations
by this Court in the said order is extracted hereunder :-
"3. The short question that arises for
consideration is whether the stand of the
management that in view of the receipts given by
the workmen dated 11.7.2000 undertaking that
they will not claim any more amounts either in
law or in equity from the mill, the amounts
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W.P.Nos.26934 & 26935 of 2015
received were vouchsafed as the full discharge of
the liability of the management. According to the
petitioner management, the management faced a
severe loss from the accounting year 1991-1992.
In view of the pecuniary limit under the Payment
of Bonus Act, majority of the workmen have gone
out of the provisions of Payment of Bonus Act.
However, the workmen were insisting for payment
during the Deepavali period.
4. Therefore, for the accounting year 1996-
1997, on 23.10.1997, a settlement was reached
under Section 18(1) of the Industrial Disputes Act
with the recognised unions, by which in respect
the workmen, whose wages exceeding Rs.3,500/-
per month, were to be paid an advance, which will
be equivalent to bonus and exgratia payable. The
mode of adjustment of the advance was to be
subsequently discussed with the Trade Unions and
decided. For the year 1997-1998, the management
also put up a notice on 5.11.1999 stating that
those workmen who are not covered by the
Payment of Bonus Act will be given an advance
on condition that the management will seek the
Central Government's sanction funs towards the
repayment of the advance. If the Central
Government agreed for the waiver, the amounts
will not be recoverable. But, however, in case of
refusal by the Central Government, the issue will
be sorted out between the authorities.
5. On 26.7.1999, the Central Government
rejected the waiver of repayment of advance
amount. The workmen did not repay the amounts
even on monthly instalments. Therefore, the
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W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
management at the time of their resignation or
retirement adjusted those amounts from the
terminal dues payable. After adjusting the
advance already made, the contesting respondents
were paid their statutory gratuity.
Notwithstanding the same, the workmen
approached the 2nd respondent with different
Gratuity Applications 7 of 2001 to 17 of 2001
claiming the unpaid gratuity. The authority
issued Notices to the petitioner mill. The
petitioner mill appeared before the authority and
contended that the quit receipt passed on by each
of the workmen at the time of leaving their service
can operate an estoppel against their claim for
unpaid gratuity. Since the management had paid
the recoverable advance, it is not open to them to
claim the difference in gratuity, which had been
adjusted against the advance already paid.
6. Before the 2nd respondent authority,
reliance was placed upon the judgment of the
Bombay High Court in Air India Ltd., vs.
Appellate authority under Payment of Gratuity
Act, 1972 and Regional Labour Commissioner
(Central), Bombay and others reported in 1999
(1) LLN 905. The Bombay High Court in
paragraphs 12 and 26 held as follows:
"12... It would be evident from the above
provisions that S.13 of the Gratuity Act protects
gratuity from being attached in execution of any
decree or order of any civil, revenue or criminal
court. Section 14 makes it clear that the
provisions of the Gratuity Act or any rule made
thereunder shall have overriding effect
notwithstanding anything inconsistent therewith
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W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
contained in any other enactment or any
instrument or contract...
26. Even assuming that there was a valid
assignment by virtue of the provisions of Cl.21 of
the agreement of leave and licence, in my view,
the provisions of S.14 will override such an
assignment."
7. Therefore, the management cannot
refuse to pay the entire gratuity on the plea that
they are entitled to adjust the advance paid to the
workmen from the gratuity payable. Again the
identical orders passed by the Controlling
Authority dated 1.1.2003, the management
preferred appeal under Section 7(7) of the
Payment of Gratuity Act, 1972 before the 1st
respondent appellate authority. Their appeals
were numbered as Gratuity Appeal Nos.241 to
250, 252, 253 of 2003. Notices were issued to the
contesting respondents. As a condition of pre-
deposit required to be made for maintaining the
appeals, the management had also deposited the
amount with the 2nd respondent.
8. Before the appellate authority, once
again similar contentions were raised. The
appellate authority relied upon Section 13,
whether the gratuity was freed from attachment
even against court decrees. He also referred to
Section 14 of the Payment of Gratuity Act, 1972
by which only better terms of payment of gratuity
has been protected. That itself will show there
cannot be payments less than the statutory
requirement. Therefore, the authority held that the
quit receipt cannot take away the claim for the
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W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
legitimate gratuity amount. The receipts cannot be
construed as if the workmen have given up their
right to receive full gratuity. Thus, the appeals
were dismissed by a common order dated
14.8.2004. It is against those order, the Writ
Petition came to be filed.
9. Mr.John, learned counsel appearing for
M/s.T.S.Gopalan and Co., contended that since
the amounts have been paid already as a
recoverable advance, it is not open to the
workmen to claim anything more inspite of
furnishing quit receipts as referred to above. In
the present case, the receipts given by the
workmen do not make the reference to any
gratuity. In fact, the receipts were printed were in
English. It was typed under the text of the receipt
that it was translated to the workmen in Tamil and
they have understood the same and have signed
those receipts. Since the text of the receipts were
not make clear, the workmen could not have
understood that gratuity was also one of the item
covered therein. The text of the undertaking
shows that the workman understood not to make
claim of any kind either in law or in equity against
the mill on any account and that the mill can
accept this as voucher of full discharge. It was
also found in those receipts that he will not make
any claim towards the closure period until the
Writ Petition filed by the petitioner was
determined by this Court.
10. Even assuming that the workman had
stated that he will not make any claim in law, such
an undertaking is clearly hit by Section 14 of the
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W.P.Nos.26934 & 26935 of 2015
Payment of Gratuity Act, 1972 as held by the
respondents 1 and 2. However, adjustment of the
recoverable advance even if it is treated as decree
of the civil court, the Payment of Gratuity cannot
be attached or adjusted in the absence of any law
to the contrary. In view of the non-obstante
clause under Section 14, the refusal made by the
petitioner mills is misconceived and not
supported by law. Hence, the Writ Petition stands
dismissed. No costs. The connected
Miscellaneous Petition stands closed.
11. In view of the dismissal of the Writ
Petition, the contesting respondents are entitled to
withdraw the amount lying in deposit with the 2nd
respondent."
5. In view of the orders cited supra, the claim of
the Management raised in the present writ petition
deserves no merit of consideration. Accordingly, the
writ petition stands dismissed. No costs. Connected
miscellaneous petition is closed."
5. Pertinently, the third respondents herein have retired from their
services long back and the matter was adjudicated before the Controlling
Authority and the Appellate Authority for several years. The Writ Petitions
itself were filed in the year 2005 and 2015 and at this length of time, any
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W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
recovery would undoubtedly cause prejudice to the interest of the workmen.
The workmen also may not be in a position to repay the amount on account
of efflux of time and due to their old age.
6. Courts have held that even if some amounts are paid to the
workman excessively or deposited in their favour, the same cannot be
recovered, if such recovery causes hardship to the workman concerned. In
the present case, the third respondents are senior citizens and workmen, who
were relieved from service many years back. Therefore, any such orders
would cause extreme hardship to their normal life.
7. The learned counsel for the petitioner made a submission that with
reference to Sections 13 and 14 of the Gratuity Act, the adjustment would
not fall within the scope of recovery contemplated under the above
provisions. However, the legal implications in this regard are left open to
the petitioners for adjudication in an appropriate manner.
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W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
8. In view of the facts and circumstances and considering the
principles laid down by this Court in W.P.No.22727 of 2005 (cited supra),
no further consideration is required and accordingly, the Writ Petitions
stand dismissed. No costs. Consequently, connected miscellaneous petitions
are closed.
12.08.2022
Index:Yes/No
Speaking order/Non-speaking order
hvk
To
1.The Regional Labour Commissioner (Central),
Sastry Bhavan,
4, Haddows Road,
Chennai – 600 006.
2.The Assistant Labour Commissioner (Central),
(Controlling Authority under Payment of Gratuity Act),
Sastry Bhavan, 4 Haddows Road,
Chennai – 600 006.
https://www.mhc.tn.gov.in/judis
W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
S.M.SUBRAMANIAM, J.
hvk
W.P.Nos.32608, 32609 of 2005 and
W.P.Nos.26934 & 26935 of 2015
12.08.2022
https://www.mhc.tn.gov.in/judis
