High Court of KeralaSingle Judge2024-07-29Disposed with a direction to pay balance gratui...

Hari Kumar V v. Union of India and others

Case / Petition Number:WP(C) No.23875 of 2020

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: N. Nagareesh
Judgment Date: 2024-07-29
Court Decision / Holding: Writ petition disposed by directing respondents 6 and 7 to pay the balance gratuity of ₹4,19,252 along with 6% interest from the date it fell due, within three months from receipt of a copy of the judgment.
Final Disposition: Disposed with a direction to pay balance gratuity along with interest within three months.

Parties to the Case

Appellants / Petitioners

Hari Kumar V

Respondents

The Union of India represented by its Secretary, Ministry of Labour and Employment
The Union of India represented by its Secretary, Ministry of Law and Justice
The State of Kerala represented by its Secretary
Regional Labour Commissioner (General)
Registrar of Co-operative Societies
Balaramapuram Service Co-Operative Bank Ltd
Board of Management of the Balaramapuram Service Co-Operative Bank

Legal Representation & Advocates

Counsels for Petitioners

• I. Vinayakumari

Counsels for Respondents

• Smt. M.S. Kiran
• Dr. K.P. Pradeep
• Smt. T. Thasmi
• Smt. Sheeja C.S.

Case Synopsis & Summary

This writ petition seeks arrears of gratuity from the 6th respondent bank, arguing that the petitioner, who retired on 31 May 2016 after 34 years of service, is entitled to gratuity under the Payment of Gratuity Act, 1972 and its rules. The bank had a Group Gratuity Insurance Policy with LIC to secure better terms, and premiums were paid annually; the actuarial computation used the last drawn salary of ₹72,354. The petitioner received ₹10 lakh from LIC under the group gratuity scheme, but contends that balance gratuity of ₹4,19,252 remains due, with interest. He notes that the Government’s retrospectively enhanced gratuity limit from ₹10 lakhs to ₹20 lakhs was implemented by an Ordinance and later notified by Gazette on 29.03.2018; however, employees in many establishments did not receive the enhanced amount due to lack of notification. The petitioner cites Chandrasekharan Nair v. Kerala State Cooperative Agricultural and Rural Development Bank Limited (2017 (4) KLT 276), affirmed by the Supreme Court in SLP No. 9446/9451/2018, and Delhi High Court Ext.P6 as well as this Court’s Exts.P11–P13 to claim entitlement to balance gratuity with interest. The Court held that LIC’s sanction of a lesser sum cannot bar entitlement to the balance and disposed of the petition by directing the 6th and 7th respondents to pay the balance gratuity with 6% interest within three months.

Provisions of Law Cited

Payment of Gratuity Act, 1972Payment of Gratuity RulesPayment of Gratuity (Amendments) Act, 1972Government of India Gazette Notification dated 29.03.2018 (towards the Payment of Gratuity (Amendments) Act, 1972)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner contends essential eligibility under the Payment of Gratuity Act, 1972 for establishments with more than 10 employees, and that a group gratuity policy with LIC cannot substitute for statutory gratuity. He urges that the 2016/2018 enhancements to gratuity, though retrospective, require notification to extend to all, including private cooperative banks; Exts.P11–P13 support entitlement to balance gratuity, and Ext.P6 (Delhi High Court) and Chandrasekharan Nair confirm the right to balance gratuity with appropriate interest; Exts.P7 and P9 show non-consideration of requests by the 6th respondent bank.

Contentions of Respondents

The respondents argue that gratuity is governed by the statutory scheme under the Payment of Gratuity Act and its rules; the group policy with LIC does not negate statutory liability. They contend that the enhanced gratuity to ₹20 lakhs required specific notification to apply beyond central government employees and RBI; the Gazette notification Ext.P5 clarifies limited applicability and requires implementation in other establishments; the bank’s payment of ₹10 lakhs was based on LIC sanction and must be interpreted within the statutory framework; reliance is placed on the Act and the lack of universal notification to extend the higher gratuity.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
Chandrasekharan Nair v. Kerala State Cooperative Agricultural and Rural Development Bank Limited	2017 (4) KLT 276	Positive	Full bench decision relied upon by the court; supported entitlement to balance gratuity and later affirmed by the Supreme Court; used to justify granting balance gratuity despite LIC policy terms.

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Extracted Judgment Text

Exact text extracted from official judgment records.

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** # **`PRESENT`** ``` THE HONOURABLE MR.JUSTICE N.NAGARESH ``` ``` MONDAY, THE 29[TH] DAY OF JULY 2024 / 7TH SRAVANA, 1946 ``` ## **`WP(C) NO. 23875 OF 2020`** ## **`PETITIONER:`** ``` HARI KUMAR V AGED 61 YEARS ``` ``` S/O VELAYUDHAN PILLAI, VAISHNAVAM, KATTAKADA ROAD,NEAR RAILWAY CROSS, THALAYIL,ATHIYANNOOR, BALARAMAPURAM.P.O, THIRUVANANTHAPURAM DIST.,PIN-695501. ``` ## **`BY ADV I.VINAYAKUMARI`** ## **`RESPONDENTS:`** - **`1 THE UNION OF INDIA REPRESENTED BY ITS SECRETARY, SECRETARY TO GOVERNMENT OF INDIA, MINISTRY OF LABOUR AND EMPLOYMENT, SHRAM SHAKTHI BHAVAN,RAFI MARG, NEW DELHI,PIN-110001.`** - **`2 THE UNION OF INDIA, REPRESENTED BY ITS SECRETARY, SECRETARY TO GOVERNMENT PLEADER, MINISTRY OF LAW AND JUSTICE, GOVERNMENT PLEADER OF INDIA, NEW DELHI, PIN-110001`** - **`3 THE STATE OF KERALA, REPRESENTED BY ITS SECRETARY SECRETARY TO GOVERNMENT OF KERALA, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.`** - **`4 THE REGIONAL LABOUR COMMISSIONER(GENERAL), KENDRIYA SHRAM SADAN,OLIMUGHAL, KAKKANAD,COCHIN,PIN-695001.`** - **`5 THE REGISTRAR OF CO-OPERATIVE SOCIETIES, JAWAHAR SAHAKARANA BHAVAN,DPI JUNCTION, THYCADU.P.O,THIRUVANANTHAPURAM-14.`** ``` WP(C) No.23875 of 2020 ``` ``` 2 ``` - **`6 THE BALARAMAPURAM SERVICE CO-OPERATIVE BANK LTD.NO.T.14, BALARAMAPURAM.P.O, THIRUVANANTHAPURAM DISTRICT, KERALA,PIN-695501, REPRESENTED BY ITS SECRETARY.`** - **`7 THE BOARD OF MANAGEMENT OF THE BALARAMAPURAM SERVICE CO-OPERATIVE BANK NO.T.14, BALARAMAPURAM.P.O,THIRUVANANTHAPURAM DISTRICT, KERALA,PIN-695501, REPRESENTED BY ITS PRESIDENT.`** ``` BY ADVS. SMT.M.S.KIRAN DR.K.P.PRADEEP SMT.T.THASMI SMT.SHEEJA C.S., SENIOR GOVERNMENT PLEADER ``` ``` THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 29.07.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WP(C) No.23875 of 2020 ``` ``` 3 ``` ## JUDGMENT Dated this the 29[th] day of July, 2024 The petitioner retired from the 6[th] respondent-Bank on 31.05.2016. The Bank always has more than 10 employees of their own. So the provisions of the Payment of Gratuity (Central) Act, 1972 and Rules framed thereunder and as amended from time to time are applicable to the 6[th] respondent-Bank, contends the petitioner. 2. For providing better terms of Gratuity to the employees of the 6[th] Respondent Bank, the Bank availed a Group Gratuity Insurance Policy from the Life Insurance Corporation of India. Accordingly, in order to get better terms of Gratuity, the petitioner opted for the above policy and premiums are being paid to the LIC every year. Salary / wages for a computation of Gratuity payable shall be taken as the last pay drawn by the employee concerned at the time of retirement or death. The last drawn salary of the petitioner ``` WP(C) No.23875 of 2020 ``` ``` 4 ``` was 72,354/-. T₹ he petitioner had 34 years of unblemished service. 3. The petitioner submits that at the time of retirement of the petitioner, the 6[th] respondent paid ₹10,00,000/- only. If calculated on the basis of the actual service of the petitioner, he is yet to receive ₹4,19,252/- from the employer. 4. The petitioner states that in order to compensate for the price rise, the Government of India enhanced the Gratuity limit from ₹10 lakhs to ₹20 lakhs retrospectively with effect from 01.01.2016 through an Ordinance as per the recommendation of the 7[th] Central Pay Commission Report. But, the employees of other Establishments or Class of Establishments, in which 10 or more employees are employed or were employed, are not receiving that enhanced Gratuity, for the lack of Notification from the Central Government regarding the amendment of Gratuity Act. Now, the Central Government has made a Gazette Notification dated 29.03.2018 as per Ext.P5. ``` WP(C) No.23875 of 2020 ``` ``` 5 ``` 5. In the light of this Notification, the above Ordinance passed in favour of the Central Government Employees towards the enhancement of gratuity from ₹10 lakhs to ₹20 lakhs with retrospective effect from 01.01.2016, was automatically cancelled. But, all of the Central Government Employees and also of the Employees of the RBI, all of them were retired before the date of the above Notification dated 29.03.2018, i.e., (from 01.01.2016 to 28.03.2018) have received the enhanced gratuity with effect from 01.01.2016. 6. The petitioner submitted that in the light of the Central Government Notification and a Full Bench decision of this Court in Chandrasekharan Nair v. Kerala State Cooperative Agricultural and Rural Development Bank Limited [2017 (4) KLT 276], which was affirmed by a three Judges Bench of the Hon'ble Apex Court, in SLP(C) No.009446/009451/2018, Ext.P6 order of the High Court of Delhi in W.P.(C) No.6423/2018 and also of this Court's three judgments as per Exts.P11 to P13, the petitioner is entitled to ``` WP(C) No.23875 of 2020 ``` ``` 6 ``` get his balance gratuity of ₹4,19,252/- with interest from respondents 6 and 7. In order to get the above balance of gratuity, the petitioner made Exts.P7 and P9 requests before the 6[th] respondent, which were not considered. 7. I have heard the learned counsel for the petitioner, the learned Central Government Counsel representing respondents 1, 2 and 4, the learned Government Pleader representing respondents 3 and 5 and the learned Standing Counsel representing respondents 6 and 7. 8. The pleadings and arguments in the writ petition would indicate that the petitioner has been granted Gratuity of an amount of 10 lakhs only on the ground that the Life₹ Insurance Corporation of India has sanctioned only 10 lakhs₹ to the petitioner towards Group Gratuity. The petitioner’s case is that the petitioner is entitled to the total gratuity amount of ₹14,19,252/-. 9. This Court has considered similar cases and held that the fact that the Life Insurance Corporation of India has ``` WP(C) No.23875 of 2020 ``` ``` 7 ``` granted only a lesser amount under the Group Gratuity Scheme, cannot be a reason to deny gratuity to an employee. Exts.P11 to P13 are the judgments to that effect. In view of the afore judgments and following the law laid down by this Court, the writ petition is disposed of directing respondents 6 and 7 to pay the petitioner the balance amount of gratuity along with interest at the rate of 6% from the date the balance amount has fallen due. Respondents 6 and 7 shall pay the amount within three months from the date of receipt of a copy of this judgment. ## Sd/- N.NAGARESH JUDGE spk ``` WP(C) No.23875 of 2020 ``` ``` 8 ``` ## **`APPENDIX OF WP(C) 23875/2020`** ## **`PETITIONER EXHIBITS`** ``` EXHIBIT P1A TRUE COPY OF THE PETITIONER'S PENSION PAYMENT ORDER NO.1083/TPM DATED 01.09.2016 ISSUED TO THE PETITIONER FROM THE OFFICE OF THE KERALA STATE CO-OPERATIVE EMPLOYEES PENSION BOARD.(KSCEPB) ``` - **`EXHIBIT P2 A TRUE COPY OF THE PENSION BOOK ISSUED TO THE PETITIONER DATED 03.09.2016 FROM THE OFFICE OF THE KSCEP BOARD.`** ``` EXHIBIT P3 ``` - **`A TRUE COPY OF THE GOVERNMENT OF INDIA 7TH CENTRAL PAY COMMISSION REPORT RELEVANT PAGES TOWARDS PENSION AND RELATED BENEFITS OF THE CIVILIAN EMPLOYEES`** - **`EXHIBIT P4 A TRUE COPY OF THE MEMORANDUM F.NO.38/37/2016-P&PWA(A)OF THE GOVERNMENT OF INDIA DATED 04.08.2016 TOWARDS GRATUITY.`** - **`EXHIBIT P5 A TRUE COPY OF THE GOVERNMENT OF INDIA GAZETTE NOTIFICATION DATED 29.03.2018 TOWARDS THE PAYMENT OF GRATUITY (AMENDMENTS)ACT,1972`** - **`EXHIBIT P6 A TRUE COPY OF THE ORDER OF THE HON'BLE HIGH COURT OF DELHI IN WP(C)NO.6423/2018 DATED 01.06.2018.`** - **`EXHIBIT P7 A TRUE COPY OF THE REQUEST LETTER DATED 01.08.2018 SUBMITTED BY THE PETITIONER BEFORE THE SECRETARY TO THE 6TH RESPONDENT BANK.`** - **`EXHIBIT P8 A TRUE COPY OF THE REJECTION LETTER DATED 11.09.2018 GIVEN TO THE PETITIONER BY THE SECRETARY TO THE 6TH RESPONDENT BANK.`** - **`EXHIBIT P9 A TRUE COPY OF THE 2ND REQUEST LETTER DATED 31.01.2020 MADE BY THE PETITIONER BEFORE THE 6TH RESPONDENT`** ``` WP(C) No.23875 of 2020 ``` ``` 9 ``` |**`EXHIBIT P10`**|**`A TRUE COPY OF THE REJECTION LETTER`**| |---|---| ||**`DATED 07.02.2020 GIVEN TO THE`**| ||**`PETITIONER BY THE 6TH RESPONDENT.`**| |**`EXHIBIT P11`**|**`A TRUE COPY OF THE JUDGMENT TO THIS`**| ||**`HON'BLE COURT DATED 30.11.2015 IN`**| ||**`WP(C)NO.29960/15`** **`TOWARDS`** **`BALANCE`**| ||**`AMOUNT OF GRATUITY DUE TO THE`**| ||**`PETITIONER IN FAVOUR OF HIM.`**| |**`EXHIBIT P12`**|**`A TRUE COPY OF THE JUDGMENT OF THIS`**| ||**`HON'BLE COURT DATED 26.03.2019 IN`**| ||**`WP(C)NO.34460/18`** **`TOWARDS`** **`BALANCE`**| ||**`AMOUNT OF GRATUITY DUE TO THE`**| ||**`PETITIONER IN FAVOUR OF HIM`**| |**`EXHIBIT P13`**|**`A TRUE COPY OF THE JUDGMENT DATED`**| ||**`20.07.2018`** **`IN`** **`WP(C)NO.20057/2018`**| ||**`TOWARDS BALANCE OF GRATUITY DUE TO THE`**| ||**`PETITIONERS IN FAVOUR TO THEM.`**|