HIGH COURT OF CHATTISGARH AT BILASPUR
WRIT PETITION (L) No. 7346 of 2007
Chhattisgarh Housing Board
...Petitioners
VERSUS
1.Appellate Authority Under the
Payment of Gratuity Act
2.Controlling Authority Under the
Payment of Gratuity Act
...Respondents
! Shri Sanjay Patel
^ Miss Sunita Jain
Shri S.K.Guha
Hon'ble Shri Satish K. Agnihotri, J
Dated:06/05/2008
: Judgment
ORDER
(Passed on 06th day of May, 2008)
1. By this petition, the petitioner challenges the validity
of the order dated 11.7.2007 (Annexure P/5) passed by the
Appellate Authority under the Payment of Gratuity Act, 1972 and
Deputy Labour Commissioner, Raipur, whereby the appeal filed by
the petitioner against the order dated 6.1.2007 (Annexure P/4)
passed by the respondent No. 2, was dismissed. The petitioner
further challenges the validity of the order dated 6.1.2007
(Annexure P/4), whereby the petitioner was directed to consider
28 years of service of the respondent No. 3 for the purpose of
calculation of gratuity.
2. The brief facts, in nutshell, are that the respondent No.
3 was initially appointed in Chuna factory on 25.11.77. When
the factory was closed on 21.03.1994, the employees, including
the respondent No. 3 was taken over by the petitioner on
06.01.2001 with effect from 21.03.1994. The respondent No. 3
retired from service on 30.04.2005. The petitioner, after
having calculated the service of the respondent No. 3 from
21.03.1994 to 30.04.2005, as 11 years, 1 month and 9 days,
computed the gratuity amount to the tune of Rs. 20,000/- and
paid the same.
3. Being aggrieved, the respondent No. 3 preferred an
application before the respondent No. 2 for consideration of
his service with effect from 25.11.1977. The respondent No. 2,
vide order dated 6.1.2007 (Annexure P/4) considered the service
period from first date of appointment in Chuna Factory i.e.
25.11.77 till 30.04.2005, as 28 years and directed to compute
the gratuity on the basis of service of 28 years and to make
the payment accordingly. Being aggrieved, the petitioner
preferred an appeal before the respondent No. 1. The respondent
no. 1, by its order dated 11.7.2007 (Annexure P/5) confirmed
the findings recorded by the respondent No. 2 and dismissed the
appeal. Thus, this petition.
4. Shri Sanjay Patel, learned counsel appearing for the
petitioner would submit that the respondent No. 3 was in
seasonal establishment and has worked for less than fifty
percent of the number of days during operation of the said
establishment. The respondent No. 3 in his return dated
17.3.2008, in para 3, has admitted that he was a seasonal
employee and no appointment order was issued to him. The
respondent No. 3 had never worked even for fifty percent of the
number of days when the old establishment i.e. Chuna factory
was in operation and as such, the respondent No. 3 was not in
continuous service before his services was taken over by the
petitioner on 6.1.2001.
5. Shri Patel would further submit that section 2-A defines
“continuous service” for the purpose of Payment of Gratuity
Act, 1972 (hereinafter referred to as `the Gratuity Act’).
Section 2A(3) of the Gratuity Act provides that where an
employee employed in seasonal establishment, is not in
continuous service within the meaning of clause (1), for period
of one year or six months, he shall be deemed to be in
continuous service under the employer for such period if he has
actually worked for not less than seventy-five percent of the
number of days on which the establishment was in operation
during such period. Thus, the employee in a seasonal
establishment has to work for not less than seventy-five
percent of the number of days on which the establishment was in
operation during such period. Thus, there was no continuity of
service which can be taken into consideration for the purpose
of computation of gratuity.
6. Shri Patel would next submit that the authorities below
have failed to consider the legal provisions for the purpose of
continuous service when admittedly, the respondent No. 3 had
never worked even for fifty percent of number of days on which
the establishment was in operation.
7. Shri Guha, learned counsel appearing for the respondent
No. 3 would submit that the respondent No. 3 was a seasonal
employee working in Chuna factory from 25.11.77 to 21.03.1994.
He had never worked even for 50 percent of number of days on
which the establishment was in operation. Since 06.01.2001 the
petitioner issued a circular whereby the service of the
respondent No. 3 was taken over by the petitioner w.e.f.
21.03.1994 the date when the establishment was closed. The
respondent no. 3 worked under the petitioner from 06.01.2001 to
30.04.2005.
8. I have heard and considered rival contentions advanced by
the learned counsel appearing for the parties, perused the
pleadings and documents appended thereto. It is evident that
the respondent No. 3, on his own admission had not worked even
for fifty percent of the number of days on which the
establishment was in operation. Under Section 2A(3) of the
Gratuity Act, in order to claim continuity in service in case
of seasonal establishment, it is necessary that the employee
should work for not less than 75 percent of the number of days
on which the establishment was in operation during such period.
Section 2A(1) and (3) of the Gratuity Act, 1972 reads as under:
“2-A. Continuous service. – For the purpose of
this Act, –
(1) an employee shall be said to be in continuous service for
a period if he has, for that period, been in uninterrupted
service, including service which may be interrupted on account
of sickness, accident, leave, absence from duty without leave
(not being absence in respect of which an order treating the
absence as break in service has been passed in accordance with
the standing orders, rules or regulations governing the
employees of the establishment), lay-off, strike or a lock-out
or cessation of work not due to any fault of the employee,
whether such uninterrupted or interrupted service was rendered
before or after the commencement of this Act;
(2) xxx xxx xxx
(3)where an employee, employed in a seasonal
establishment, is not in continuous
service within the meaning of clause (1),
for any period of one year or six months,
he shall be deemed to be in continuous
service under the employer for such period
if he has actually worked for not less
than seventy five percent of the number of
days on which the establishment was in
operation during such period.”
9. It is well settled position in law that admission is the
best piece of evidence against the person making an admission.
(See Delhi Transport Corporation v. Shyam Lal1).
10. The Supreme Court, in the matter of Banaras Hindu
University, Varanasi and another v. Dr. Indra Pratap Singh2,
has held as under:
“12. In Words and Phrases (Vol.9) the word
“continuous employment” is assigned the
following meaning:
“It means working with reasonable
regularity, and work does not cease to be
`continuous’ because of interruption in
occupation due to periods of temporary
illness, such as are the incident to people
of normal health. `Continuously’, as used
in regulations defining total permanent
disability under war risk policy, does not
denote absolute continuity.”
11. It is true that the gratuity for workers is no longer a
gift but a right. The right flows from the provisions of the
Gratuity Act. Bare perusal of the definition of continuous
service as enshrined in Section 2A of the Gratuity Act, it is
clear that the actual work is not necessary but for calculation
of continuous service in seasonal establishment, the employee
ought to have worked not less than 75 percent of the number of
days during the period seasonal establishment was in operation.
Chuna factory is admittedly a seasonal establishment and the
respondent No. 3 in his return has admitted that he had never
worked even for fifty percent of the total days during which
the seasonal establishment i.e. Chuna factory was in operation.
12. The respondent No. 1 and 2 are in serious error while
holding that the service of the petitioner should be counted
from the initial date of appointment in seasonal establishment
i.e. 25.11.1977. The authorities below have not considered the
definition of continuous service in its right perspective as
enshrined in section 2A of the Gratuity Act.
13. The petitioner has rightly calculated 11 years, one month
and 9 days for the purpose of gratuity and granted the gratuity
from the date of taking over i.e. 21.03.1994 till the
respondent No. 3 retired from service on 30.04.2005, and
payment was made accordingly.
14. For the reasons mentioned hereinabove, this petition
succeeds. The orders dated 11.7.2007 (Annexure P/5) and
06.01.2007 (Annexure P/4) are quashed. The petition is allowed.
No order asto costs.
JUDGE