The Chief Manager, Indian Rare Earths Limited v. M.A. Chandran and Others

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT:- THE HON'BLE THE CHIEF JUSTICE MRS. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN MONDAY, THE 11TH DAY OF FEBRUARY 2013/22ND MAGHA 1934 ## **W.A.No.241 of 2013** ------------------------------------- AGAINST THE JUDGMENT IN W.P.(C).No.36755/2008, DATED 05-11-2012. ---------------------------- ## **APPELLANT/** PETITIONER:- ---------------------------------------- THE CHIEF MANAGER, INDIAN RARE EARTHS LIMITED, RARE EARTHS DIVISION, (EARLIER KNOWN AS HEAD RE DIVISION), UDYOGAMANDAL, ERNAKULAM DISTRICT. BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR. ## **RESPONDENTS/** RESPONDENTS:- --------------------------------------------------- 1. M.A.CHANDRAN, GOPIKA, 61/2038, PONOTH ROAD, GYMNASIUM LANE, COCHIN - 17. 2. THE CONTROLLING AUTHORITY UNDER THE PAYMENT OF GRATUITY ACT, 1972 [ASSISTANT LABOUR COMMISSIONER (CENTRAL)], KAKKANAD. 3. THE APPELLATE AUTHORITY UNDER THE PAYMENT OF GRATUITY ACT, 1972 [REGIONAL LABOUR COMMISSIONER (CENTRAL)], KAKKANAD. R1 BY ADV.SRI.C.S.AJITH PRAKASH BY SENIOR GOVERNMENT PLEADER SRI.P.I.DAVIS. THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 11-02-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:- Manjula Chellur, C.J. & K.Vinod Chandran, J. ------------------------------------W.A.No.241 of 2013 -------------------------------------- Dated this, the 11[th] day of February, 2013 ## JUDGMENT ## K.Vinod Chandran,J. Impugned in this appeal is the judgment in the writ petition, which refused to interfere with Exhibit P6 order of the Controlling Authority under the Payment of Gratuity Act, 1972 (hereinafter referred to as “Gratuity Act”) and Exhibit P8 order in appeal confirming the decision of the Controlling Authority. 2. The issue revolves around the gratuity entitlement of the 1[st] respondent, who was an employee of the appellant Company; and retired as per a Voluntary Retirement Scheme of 2001 (hereinafter referred to as “the Scheme”) notified by the Company. He had shown the date of joining in the Company as 13.7.1977 and had declared the completed years and months of service as “24 years and 6 months”. His application was considered and accepted by Exhibit P3 order. After his retirement under the Scheme in the year 2002, the 1[st] respondent raised a claim before the 2[nd] respondent under the - 2 - W.A.No.241/2013 Gratuity Act for computation of gratuity for the period he had been employed as a casual employee in the Company prior to regularization and for correction of computation in the last wages. The Controlling Authority, 2[nd] respondent, framed three issues to be decided in the application filed by the 1[st] respondent, which are as under: - “(a) Whether the applicant has joined the services in the year 1974 or 1977? - (b) And whether the last drawn salaries of the applicant was Rs.10,747/- or Rs.10627/- and - (c) Whether the applicant is entitled for any amount towards additional gratuity and if so whether he is entitled for any interest on the same”. All the issues were found in favour of the 1[st] respondent and gratuity was directed to be paid adopting the last drawn wages as Rs.10,747/- and computing the total number of years as 28 years. Interest was also directed to be paid at the rate of 10%. In appeal, the said order was confirmed. 3. We remind ourselves that the original authority and the appellate authority have gone into the evidence adduced before them and has come to the conclusion that the - 3 - W.A.No.241/2013 claim raised by the 1[st] respondent has to be allowed, and that we are sitting in the extra-ordinary jurisdiction exercising powers of judicial review of the orders of the authorities below. 4. The learned counsel for the appellant would, relying on Exhibit R1(d), submit that this amply demonstrates that the 1[st] respondent was not employed for more than 240 days in the subject year. The learned counsel would also rely on Exhibit P1 to contend that even as per the self declaration of the 1[st] respondent under the Scheme, his date of joining is shown as 13.7.1977 and he has completed only 24 years and 6 months of service. The 1[st] respondent having chosen to apply for retirement under the Scheme, cannot have a further claim for gratuity for any further earlier periods. The learned counsel also relies on a Division Bench decision of this Court reported in _**Velukutty Achary v. Harrisons Malayalam Ltd.**_ **[1992 (2) KLT 622].** 5. We are not impressed with the argument that Exhibit R1(d) would demonstrate that the 1[st] respondent was not employed for 240 days in the year ending March, 1976. Without any evidence as to the salary drawn by the 1[st] - 4 - W.A.No.241/2013 respondent in the year 1976, we cannot come to any such conclusion; nor are we expected to make a roving enquiry in the circumscribed jurisdiction we exercise herein. However, we have to notice that the contention of self declaration under the Scheme is not sustainable for the simple reason that the entitlement to gratuity does not flow from the scheme as such and is a necessary consequence of the retirement of the 1[st] respondent, which flows from the Gratuity Act. Whether he is voluntarily retired or is retired on reaching the age of superannuation or even at any point earlier leaving the service of the Company; obviously he would be entitled to the claim for gratuity, provided the minimum period of service as stipulated under the Gratuity Act has been completed. We have been taken through the decision reported in _**Velukutty Achary's case**_ ( _supra_ ) **,** wherein it has been declared that a person who is not an employee but offered work whenever available does not come under Section2A(1) of the Act. We immediately notice the following observations made by the Division Bench: _“_ If however, a person is an employee first and then, the employer does not allot him work on certain days, those - 5 - W.A.No.241/2013 days where, for no fault of the employee, no work is allotted to him, cannot be treated as interruptions”. 6. Hence, we have to address ourselves as to the issue whether the casual employment of the 1[st] respondent would come under the 1[st] limb or the 2[nd] limb of the declaration of the Division Bench. We notice that the Divisional Employment Officer had intimated the 1[st] respondent by Exhibit R1(a) about the vacancies that existed in the company in 1973 and directed the 1[st] respondent to be present for ensuring minimum physical requirements. That having been satisfied, the Company by Exhibit R1(b) dated 1.11.1973 directed the 1[st] respondent to be present for an interview on 22.11.1973. We notice that Exhibit R1(b) specifically stated that as per the recommendation by the Employment Exchange, the 1[st] respondent was called, to be considered for the **vacancy** of Helper **existing** in the Company. Exhibit R1(b) also provided that the initial engagement would be on casual basis, on a daily wage rate, and selection in the regular service of the Company would be only after gaining sufficient experience. We also notice the offer of employment to the post of Helper by - 6 - W.A.No.241/2013 memo dated 11.3.1974, produced as Exhibit R1(c), which contained the following stipulation: - “(2) You will be paid wages for days of actual work only which are normally 6 days in a week”. This would definitely demonstrate that the actual work expected by the Company was to be six days in a week and the casual employment was against a regular vacancy. 7. We notice that there is nothing on record produced by the Company to dispel the evidence produced by the 1[st] respondent and the Company does not at all dispute Exhibits R1(a) to R1(c). Hence, we held that the finding of the Controlling Authority that the 1[st] respondent is entitled to be paid gratuity determining his date of appointment as 13.3.1974, is eminently possible from the evidence on record. 6. We also notice that though the last drawn salary for computing the benefits under the Scheme is to be taken as that of the year 2001; gratuity definitely stands on a different footing. We have noticed earlier that, the payment of gratuity is not dependent upon the terms of the Scheme. The minimal revision in salary of the 1[st] respondent was due to W.A.No.241/2013 - 7 - interregnum between the submission of the application under the Scheme and the acceptance of the same, finally culminating in relieving the appellant on voluntary retirement. The last drawn wages for payment of gratuity would be that drawn by the 1[st] respondent at the time of his being relieved from the service. The terms of the Scheme would be applicable only with respect to the computation of the benefits under the Scheme. The Scheme would have provided that in computing the benefits, the last drawn pay as on the date of application is applicable. But, the gratuity would be payable as per the statutory prescription. We do not see any reason for interfering with the grant of 10% simple interest also. 7. We agree with the learned Single Judge that the orders passed by the statutory authority and confirmed in appeal are not liable to be interfered with on an exercise of the extra-ordinary jurisdiction conferred on this Court. We confirm the orders of the statutory authorities and dismiss the above appeal. As has been noticed by the learned Single Judge, it is needless to say that the said order would only entitle the 1[st] respondent for payment of additional gratuity as has been - 8 - W.A.No.241/2013 computed in Exhibit P6 order and would not entitle any revision of the compensation granted under the VRS, which is regulated by the Scheme and is further confined to the period declared by the 1[st] respondent in Exhibit P1 application. We leave the parties to suffer their respective costs. Sd/Manjula Chellur, Chief Justice vku/ Sd/K.Vinod Chandran, Judge - true copy -