BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 28/01/2011 CORAM THE HONOURABLE MR.JUSTICE K.CHANDRU W.P.(MD)No.4387 of 2010 and M.P.(MD)No.1 of 2010 M/s.The Management of Madurai East Sarvodaya Sangh, 269, Kamarajar Salai, Madurai -9 through its Secretary S.Kumarasean ... Petitioner Vs 1.S.Girija 2.Controlling Authority under the Payment of Subsistence Allowance Act, The Assistant Commissioner of Labour, Office of the Deputy Commissioner of Labour, 142/1 Sundaram Theatre Road, K.K.Nagar, Madurai -20. 3.Appellate Authority under the Payment of Subsistence Allowance Act, Deputy Commissioner of Labour, 142/1, Sundaram Theatre Road, K.K.Nagar, Madurai -20. ...Respondents PRAYER Petition filed under Article 226 of the Constitution of India praying for the issuance of a Writ of certiorari, calling for the records from the file of the 3rd respondent herein in case No.PSAA 6 of 2008 and to quash the order dated 30.11.2009 passed therein. !For Petitioner ... Mr.P.Chandra Bose ^For Respondents ... Mr.S.C.Herold Singh,G.A. For R2 and R3 :ORDER
The petitioner is the Management of Madurai East Sarvodaya Sangam. They
have filed the present writ petition seeking to challenge the order passed by
the third respondent Appellate Authority under the payment of Subsistence
Allowance Act, 1981 in P.S.A.A.6/2008 dated 30.11.2009 confirming the orders
passed by the second respondent controlling authority dated 11.06.2008 made in
P.S.A.No.3/2007.
2. The first respondent was employed as an Assistant in the petitioner
Sangam. She was placed under suspension with effect from 08.04.2004. Therefore,
she claimed subsistence allowance for the period from 08.04.2004 to 03.09.2005.
For the first period, she claimed subsistence allowance at the rate of 50%, for
the second period i.e.90 days to 180 days, she claimed at the rate of 75% and
thereafter, for the further period at the rate of 100% in terms of Section 3 of
the Tamil Nadu Payment of Subsistence Allowance Act, 1981 (for short PS Act)
3. The second respondent, being the controlling Authority entertained her
claim as P.S.A.No.3/2007 and issued notice to the petitioner. The petitioner
filed a counter statement dated Nil (May 2007). The stand of the petitioner was
that the first respondent was dismissed from service with effect from 08.04.2004
for various acts of misconducts and therefore until and unless the said
dismissal order is set aside by a competent court, she cannot claim any
subsistence allowance. Without prejudice to the said stand, it was submitted
that subsistence allowance was paid as per the provisions of the P.S.Act. The
said payment will also attract the provisions of Employees Provident Fund. The
petitioner has deducted amounts towards subscription in the Provident Fund and
had paid the contribution to the PF department. The deductions made in the
subsistence allowance is legal and valid and no amount is due and payable to the
first respondent. They had also filed a calculation sheet in relating to the
payment of subsistence allowance paid to the petitioner, deductions made so far
and the balance payment of subsistence allowance to be paid and further
deductions to be made in the balance amount. The amount worked out to
Rs.62,911/- for the period from 08.04.2004 to 03.09.2005. She was already paid
Rs.29,171/-. After making deductions towards Welfare Fund loan, Bank Loan,
Family welfare fund loan, Security as well as PF and also the loss towards stock
shortage, the balance amount worked out to Rs.10,100/-. Even from that
Rs.10,100/-, PF amount, welfare fund loan amount and bank loan and further
amounts are to be deducted, finally the balance to be paid was Rs.7,608/-.
4. Before the authority, the first respondent examined herself as P.W.1.
On the side of the petitioner, one R.Nagarajan was examined as R.W.1. On the
side of the first respondent, she marked her suspension order as Ex.P1 and on
the side of the Management, 3 documents were filed and marked as Exs.R1 to R3.
5. The authority found that no deductions are permissible in the
subsistence allowance and after giving credit to the earlier amount of
Rs.29171.50, they will have to pay the balance of Rs.34,308/-. Challenging the
same, they filed an appeal under Rule 5A of the Tamilnadu Payment of Subsistence
Allowance Rules. As a condition precedent, they have deposited the entire amount
before the third respondent. The said appeal was taken on file as
P.S.A.A.No.6/2008 and notice was given to the first respondent.
6. The first respondent filed a counter statement dated 7.7.2009. The
third respondent by a final order dated 30.11.2009 rejected the case of the
petitioner and it held that no deduction is permissible from the subsistence
allowance. The authority also held that the Act requires payment of 100% of the
wages beyond 180 days of suspension and if the entire amount is paid as wages,
then certainly PF amount can be deducted for that portion. Under Rule 3(ii) of
the PS Rules, no deduction is permissible from the subsistence allowance payable
to an employee.
7.Mr.P.Chandra Bose, learned counsel for the petitioner relied upon the
judgment of the Supreme Court in Regional Director, Employees’ State Insurance
Corporation v. M/s.Popular Automobiles reported in AIR 1997 SC 3956. The Supreme
Court in that judgment has held that during the suspension period, the
employee/employer relationship exists. He is prevented from only discharging his
work and therefore, subsistence allowance is very much part of the term ‘Wages’
as defined under Section 2(22) of the ESI Act and employer is bound to make
contribution under Section 39 of the PF Act.
8. In the present case, Rule 3(ii) clearly prevents any deduction.
Therefore, the third respondent has maintained the balance while following the
judgment of the Supreme Court in the case of Popular Automobiles (cited supra)
and he also gave full meaning to Rule 3(ii). Therefore, his finding that beyond
180 days when an employer is bound to pay full wages, then Rule 3(ii) will not
have any operation and PF Contribution can be deducted from the so called
subsistence allowance. It is necessary to refer to Rule 3(ii):-
“The subsistence allowance payable under this Act shall be paid in full subject
to restrictions under the Act and it shall not be liable for any deduction”.
9. This court is not inclined to accept the contentions raised by the
petitioner. Even if the petitioner’s contention is accepted that it could only
related to PF account and not for other payments to be made by him, in the
absence of any enabling provision and the amount to be deducted towards PF is a
very negligible amount, and considering the fact that the first respondent was
under suspension for more than a year, this Court is not inclined to interfere
with the order passed by the authorities.
10. Hence, this writ petition stands dismissed. In view of the dismissal
of the writ petition, there is no impediment for the first respondent to
withdraw the amount lying in deposit with the second respondent. No costs.
Consequently, connected miscellaneous petition is closed.
svki
To
1.Controlling Authority under the
Payment of Subsistence Allowance Act,
The Assistant Commissioner of Labour,
Office of the Deputy Commissioner of Labour,
142/1 Sundaram Theatre Road,
K.K.Nagar, Madurai -20.
2.Appellate Authority under the
Payment of Subsistence Allowance Act,
Deputy Commissioner of Labour,
142/1, Sundaram Theatre Road,
K.K.Nagar, Madurai -20.