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SCA/10481/1999 7/ 7 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL
CIVIL APPLICATION No. 10481 of 1999
For
Approval and Signature:
HONOURABLE
MR.JUSTICE KS JHAVERI
=========================================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To
be referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
=========================================================
STATE
OF GUJARAT - Petitioner(s)
Versus
KASHIBEN
RANCHHODBHAI MALIWAD & 2 - Respondent(s)
=========================================================
Appearance :
MR KP RAVAL
AGP for Petitioner(s) : 1,
MRS PC FERNANDEZ
for Respondent(s) : 1,
MR MP SHAH for Respondent(s) : 2,
MS.
KRUTI M SHAH for Respondent(s) : 2,
MS VD KAPADIA for
Respondent(s) : 2,
MR KP RAVAL AGP for Respondent(s) :
3,
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE KS JHAVERI
Date : 30/07/2010
ORAL
JUDGMENT
1. The
issue involved in this petition is squarely covered by the decision
of this Court rendered in Special Civil Application No. 10483 of 1999
dated 03.08.2007. The said order reads as under :-
“The
petitioner-State Government, being aggrieved by the order dated 6th
April, 1999 passed by the Appellate Authority under the Payment of
Gratuity Act, 1972, Vadodara, is before this Court with a submission
that the Appellate Authority was absolutely unjustified in directing
the State Government to make the payment of gratuity to the
claimant/workman – Ramkrushna Gopal Soni, though it has come on
record that Ramkrushna Gopal Soni was an employee of Girls Remand
Home run by a registered Trust.
2. Shri
I.M. Pandya, learned Assistant Government Pleader for the
petitioner-State, submitted that a perusal of the order made by the
Controlling Authority under the Payment of Gratuity Act, 1972
(Annexure-B to the petition) would show that the dispute was between
the workman – Ramkrushna Gopal Soni and the Secretary of the
Remand Home and the State was not a party and the final order was
made by the Controlling Authority against the Trust only. It is
submitted that the State Government could not be joined as a party
respondent at the instance of a person, who had lost before the
Controlling Authority. His further submission is that joinder of the
State Government/Director, Social Security Department was patently
illegal. According to him, if the dispute was between the workman and
the employer and even if the employees’ salaries were sanctioned or
granted by the State Government, then too, there would be no
relationship of master and servant/ employer and employee between the
State and the respondent-workman. He submitted that the Appellate
Authority erred in issuing such directions.
3. Shri
G.C. Ray, learned Counsel for respondent No.1-workman, however,
submitted that in fact, the claim was made against the registered
Trust and he did not join the State Government as party. On being
asked, he stated that as no relief was given against the State in the
order passed by the Controlling Authority, the workman did not
challenge the said order, nor made any claim for grant of any relief
against the State Government.
4. Ms.
Kruti Shah, learned Counsel for respondent No.2-Trust, appeared at a
stage when both the learned Counsel, Shri I. M. Pandya and Shri G.C.
Ray, had completed their arguments. She appeared and argued the
matter, however, finding it difficult to give replies to the
questions put by the Court, she started praying for time. When the
Court refused to grant the adjournment, she said that there was some
judgement of Mr. Justice Ravi R. Tripathi wherein the learned single
Judge had observed that it was the duty of the State Government to
maintain the Remand Homes and the State would be obliged to pay
salary, etc. to the workman working in the Remand Homes. When the
Court again asked for copy of the judgement, she prayed for time. The
Court again refused to grant time. On this, she said that the Court
may record her request and after rejecting the same, may proceed to
decide the matter. Ordinarily, such curt words when are used by a
Counsel, they perilously border a serious risk, but, in case of Ms.
Shah, who is yet to see her life and different colours of it, I do
not propose any action against her, but, would only advise her that
result oriented advocacy and high pitched arguments in the Court do
not result into success. To be more successful in a Court, one has to
be clear in his/her thoughts, ready on law and if not absolutely, a
little mannerful in the Court. Courtesy demands courtesy and if one
lacks courtesy, then, at least in the Court of law, he/she would not
be respected by others. The manner in which she had behaved in the
Court is not palatable. Though I could record my displeasure against
her conduct, but, with folded hands, I will request her to mend her
behaviour and come upto the expectations of the noble profession.
5. In
the present matter, the workman made an application to the
Controlling Authority for a direction to the employer to pay the
amount of gratuity. The workman did not make any claim against the
State Government nor the Trust ever stated before the Controlling
Authority that the gratuity should be paid by the State Government
either under the provisions of the social security or that it was the
duty of the State Government to maintain and run the Remand Homes for
Girls. It was a plain and simple matter between the master and
servant. If the State Government, finding its inability to run the
Remand Homes, permits some institution, including registered trust,
to run the Remand Homes and authorise the Remand Homes and its
management/administration to appoint and employ the workman and also
agrees to disburse some money in favour of such management/trust so
that they can meet their day to day expenses. It cannot be said that
such workman becomes the employee of the State Government.
6. It
is not in dispute before me that day to day management of the Remand
Home is in the hands of the Trust, they are managing the Remand Home
and they are simply getting the grant-in-aid from the State
Government. The grant-in-aid if is given by the State Government to
any authority, then, employees of such authority, institution or
association would not become the employees of the State Government.
In number of schools and colleges, the State Government issues grant,
delivers grant, sanctions grant to many of the corporations,
panchayats and other authorities, the Government extends financial
grant, but, such person, though under the control of the Government
because of the financial assistance, would not become the Government
or State for the purposes of Article 12 of the Constitution of India.
7. It
is not in dispute that the respondent-workman was employed as an
employee by the Trust. It is also not in dispute that the Trust was
appointing, disciplinary and dismissal authority for the said
workman. If the respondent-Trust was exercising absolute control as
a master over the workman, then, the liability of the Trust was to
make payment of the salary and gratuity. It would have been a
different thing for the Trust to say that they would make the payment
of gratuity after they receive the grant, but, they could not join
the State as a party respondent before the Appellate Authority and
seek an order against the present petitioner for payment of gratuity.
8. The
respondent-Trust, though knew well that the State or the Director,
Social Security was not a party before the Controlling Authority,
without seeking any permission from the Appellate Authority, it
joined the Director as a party respondent. Addition of such party
before the Appellate Authority is patently illegal and speaks bad
against such appellant, who with an ulterior motive joins the State
Government as a party respondent.
9. The
payment of Gratuity Act, 1972 (39 of 1972) is an Act to provide for a
scheme for the payment of gratuity to employees engaged in factories,
mines, oilfields, etc. and for matters connected therewith or
incidental thereto.
10. The
word ‘gratuity’ imports an idea of ‘gift’ or ‘present’ in return for
favour of the services generally, but, the Payment of Gratuity Act,
1972 reverses this norm. The Act provides that a person who has
completed five years or more service with the Establishment as an
employee would be entitled to some gratuity. The gratuity would be
payable to an employee by the employer on superannuation of the
employee or on his retirement or resignation or on his death or
disablement due to accident or disease.
11. Section
2(e) of the Act provides that an ’employee’ means any person (other
than an apprentice) employed on wages, in any establishment, factory,
mine, oilfield, plantation, port, railway company or shop to do any
skilled, semi-skilled, or unskilled, manual, supervisory, technical
or clerical work, whether the terms of such employment are express or
implied, and whether or not such person is employed in a managerial
or administrative capacity, but does not include any such person who
holds a post under the Central Government or a State Government and
is governed by any other Act or by any rules providing for payment of
gratuity.
A
fair reading and understanding of the definition of ’employee’ would
clearly show that an employee is the person who is engaged in or
employed on services by an employer.
12. Section
2(f) provides that an “employer means, in relation to any
establishment, factory, mine, oilfield, plantation, port, railway
company or shop –
(i)
belonging to, or under the control of, the Central Government or a
State Government a person or authority appointed by the appropriate
Government for the supervision and control of employees, or where no
person or authority has been so appointed, the head of the Ministry
or Department concerned,
(ii) belonging
to, or under the control of, any local authority, the person
appointed by such authority for the supervision and the chief
executive officer of the local authority,
(iii) in
any other case, the person, who, or the authority which, has the
ultimate control over the affairs of the establishment, factory,
mine, oilfield, plantation, port, railway company or shop, and where
the said affairs are entrusted to any other person, whether called a
manager, managing director or by any other name, such person;”
Perusal
of Clause (iii) of Section 2(f) of the Act would make it clear that
an employer would be a person who has the ultimate control over the
affairs of the establishment, etc. and where the said affairs are
entrusted to any other person, whether called a manager, managing
director or by any other name. Therefore, to show that the State
Government was the employer, the Trust was required to show to the
Court that the State Government had ultimate control over the affairs
of the establishment. If the respondent-Trust is unable to prove that
the State had ultimate control over the affairs of the establishment.
If it floats on the surface of records that the Trust was in absolute
control of the affairs and was to act as an employer of the workman,
then, the Trust would not be allowed to say that because the State
extends grant-in-aid, the workman would be deemed to be an employee
of the Government and even if that is not so, the State would be
obliged to make payment of gratuity to the employee.
13. It
was also contended by Ms. Shah that the Remand Homes are to be run by
the State Government and if the State is not ready and willing to
extend the grant-in-aid or pay the expenses to the Trust, then, the
Trust may close down their activities. I am shocked to hear this
argument. When a Trust comes into existence with a laudable object,
then, the Government, so also the public, repose their trust in the
said Trust. A Trust cannot say that they would run charitable
activities or would manage the Remand Homes only if money is paid to
them. If some money is to be paid to them, then, it is better that
instead of reposing any trust in the Trust, some Non-Government
Organisations (NGOs) are employed to run such institutions. The
respondent-Trust cannot be allowed to say or threaten the system that
if money is not paid to them, they would stop their charitable
activities. Even if they proposes to do it, it is for them and the
Court has nothing to do with it.
14. In
the present matter, the Appellate Authority, without appreciating
that the State Government could not be held liable to make payment of
the gratuity to the employee/workman, erred in observing that the
State is liable to make the payment.
15. For
the reasons aforesaid, I must hold that the order passed by the
Appellate Authority, requiring the State to make payment of gratuity
to the workman or to extend grant in favour of the respondent-Trust,
is patently illegal, the said order cannot be allowed to stand, it
deserves to and is, accordingly, quashed.
16. It
is also to be seen that against the liability fixed upon the
respondent-Trust, the said Trust has not come up with any Writ
Application, therefore, their liability is absolute.
17. The
petition is allowed. The State is held not liable to make payment of
gratuity. Rule is made absolute. No costs.”
2. In
view of the aforesaid order, this petition stands disposed of on the
same terms. Rule is made absolute to the above extent with no order
as to costs.
[K.S.
JHAVERI, J.]
/phalguni/
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