Gujarat High Court Case Information System Print SCA/844/2010 20/ 22 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 844 of 2010 For Approval and Signature: HONOURABLE MR.JUSTICE H.K.RATHOD Sd/- ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? YES 2 To be referred to the Reporter or not ? YES 3 Whether their Lordships wish to see the fair copy of the judgment ? YES 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 ? NO 5 Whether it is to be circulated to the civil judge ? NO ========================================================= PITAMBERDAS RAMCHANDRA VATWANI - Petitioner(s) Versus GIRISHKUMAR TULSIBHAI MAKWANA & 24 - Respondent(s) ========================================================= Appearance : MR PRABHAKAR UPADYAY for Petitioner(s) : 1, None for Respondent(s) : 1 - 25. ========================================================= CORAM : HONOURABLE MR.JUSTICE H.K.RATHOD Date : 29/03/2010 ORAL JUDGMENT
1. Heard
learned advocate Mr. Prabhakar Upadhyay appearing on behalf of
petitioner.
2. The
petitioner has challenged order passed by Controlling Authority dated
25th June 2008 in Gratuity Case No.125 of 2007 to 149 of
2007 and order passed by Controlling Authority dated 6th
July 2009 and order passed by Appellate Authority dated 29th
July 2009 before this Court in present petition.
3. Learned
advocate Mr. Upadhyay raised contentions before this Court that on
26th august 2008, the settlement was arrived at between
present petitioner and representative of present respondents by way
of full and final settlement and representative of present
respondents collected the amount from the present petitioner. The
present petitioner preferred Review Application before Controlling
Authority and Controlling Authority without registering the Review
Application on record rejected the same on 6th July 2009.
Against which, appeal which was preferred by petitioner has been also
rejected because appeal was not preferred in time. Thereafter,
Recovery Certificate has been issued by Controlling Authority and
Recovery Officer has issued notice under Section 154 of Bombay Land
Revenue Code on 3rd August 2009. Therefore, he submitted
that respondents employees have filed application before Controlling
Authority under the provisions of Payment of Gratuity Act on 5th
October 2007 giving details about working period of service and
salary and date of termination. The Controlling Authority has decided
all applications on 25th June 2008 in Gratuity Case No.125
of 2007 to 149 of 2007, where, hearing was taken place between the
parties before Controlling Authority between 19th November
2007 to 16th June 2008, where, on behalf of Union, one Mr.
R.G. Jogi and Assistant Secretary Jayantibhai Patel was remained
present, but, on behalf of petitioner, no one remained present and no
reply was filed by petitioner, therefore, Controlling Authority has
directed to present petitioner to pay amount of gratuity claimed by
workmen by order dated 25th June 2008. The Controlling
Authority has noted that though notice has been served to petitioner
and workmen has sent Form – ‘I’ to petitioner establishment, but, no
reply is filed by petitioner and application was also not submitted
before Controlling Authority for requesting time and no objection
raised against gratuity application filed by workmen, therefore,
ex-parte order has been passed against present petitioner.
4. Thereafter,
petitioner has filed Review Application before Controlling Authority
with a prayer to set aside ex-parte order in 9th June
2009. This Application has been rejected on 6th July 2009
by Controlling Authority after period of limitation and therefore,
Review Application has been rejected.
5. This
Court has asked specific question to learned advocate Mr. Upadhyay
that is there any provisions made in Payment of Gratuity Act which
gives power to Controlling Authority to review the order or to set
aside its ex-parte order ? He is not able to point out any provisions
from the Payment of Gratuity Act which gives power to Controlling
Authority to review its own order or to set aside its ex-parte order.
Therefore, contentions raised by learned advocate Mr. Upadhyay cannot
be accepted, because, there is no provision pointed out by him that
Controlling Authority has power to review its own order or to set
aside ex-parte order. Thereafter, appeals have been preferred by
petitioner against order passed in Review Application as well as
ex-parte order passed by Controlling Authority on 25th
June 2008 and 6th July, 2009. These appeals have been
rejected on the ground of delay under Sec.7(7) of Payment of Gratuity
Act, wherein, appeal is required to be filed by petitioner within a
period of 120 days from date of order passed by Controlling Authority
30th June 2008. Therefore, Appellate Authority has
rejected appeal on the ground of delay, for which, Appellate
Authority has no power to condone delay beyond period of 120 days
under provisions of Sec.7(7) of Payment of Gratuity Act.
6. Thereafter,
Recovery Certificate has been issued by Controlling Authority to
recover the amount from petitioner under the provisions of Bombay
Land Revenue Code which notice under Sec.152 dated 8th
April 2009 has been received by petitioner on 4th May
2009. Thereafter, on number of occasions, amount has been demanded by
Recovering Authority, but, that amount is not deposited by
petitioner. Therefore, warning was given to petitioner for attaching
his movable properties under Sec.154 of Bombay Land Revenue Code.
7. It
is necessary to note that a letter Page 58 Annexure ‘H’ dated 1st
July 2007 has been given by one Trilokchand Mulchand Vatvani
addressed to petitioner to pay amount of gratuity to concerned
workmen, otherwise, necessary action will be taken against petitioner
by Union Representative. Annexure ‘H’ Page 62 is a Settlement
arrived at between Trilokchand Mulchand Vatvani being a Union
Representative of 25 workmen and Pitamberdas Ramchand Vatvani the
petitioner owner of establishment on 26th August 2008
before Notary Advocate. In the said Settlement, Union Representative
has agreed for lump-sum amount of Rs.75,000/- on behalf of 25 workmen
which is contrary to order passed by Controlling Authority and Union
Representative has agreed that total amount has been received by him
Rs.1,50,000/- and in view of that, workmen will not claim any Earned
Leave and amount of Gratuity. Relying upon this Settlement arrived at
between Union Representative and petitioner against claim of gratuity
and Earned Leave of workmen, according to order passed by Controlling
Authority in favour of 25 workmen, total amount of gratuity comes to
Rs.12,20,940/-. Against which, a Union Representative has settled the
matter on behalf of 25 workmen in Rs.75,000/- only, which is contrary
to Sec.14 of the Payment of Gratuity Act, which having overriding
effect to other enactment or any instrument or contract having effect
by virtue of any enactment other than this Act. So, any contract or
settlement which is found to be contrary to provisions of Payment of
Gratuity Act where less amount has been paid to workman against the
claim of workman for more amount, then, such contract is contrary to
provisions of Payment of Gratuity Act.
8. The
right to receive an amount of gratuity as per provisions made in
Payment of Gratuity Act; any curtailment of benefits by management or
deprivation of any existing benefits available to workman under
provisions of Payment of Gratuity Act cannot be inferred without a
provision to that effect either express or implied. Therefore, such
alleged settlement with Union Representative which apparently found
contrary to order passed by Controlling Authority against interest of
present respondent workmen. No deduction or reduction in amount of
gratuity is permissible contrary to provisions of Payment of Gratuity
Act, 1972.
9. Therefore,
the settlement which has been relied upon by learned advocate Mr.
Upadhyay is not helpful to petitioner, because, amount which has been
accepted for claim of 25 workmen only Rs.75,000/- against total claim
of workmen to receive amount of gratuity which comes to
Rs.12,20,940/- as per order passed by Controlling Authority.
Therefore, such settlement itself is null and void, illegal
and contrary to provisions of Payment of Gratuity Act.
10. It
is also necessary to note that this settlement does not bare the
signature of any workman. This settlement has not been accepted by
any workman and not produced on relevant record by petitioner before
Controlling Authority and Appellate Authority. In present case,
petitioner has not filed any affidavit of Union Representative Shri
Trilokchand Mulchand Vatvani. The employer petitioner Pitamberdas
Ramchandra Vatvani and Union Representative, both, belong to same
caste and therefore, it is apparently found that there is a clear
collusion between parties who have settled the matter in absence of
workmen against the claim of workmen of gratuity which apparently
contrary to the Payment of Gratuity Act. The employer petitioner is
under legal obligation to pay complete amount of gratuity to
concerned employees who are entitled as per law and when any amount
less than it means contrary to provisions of Payment of Gratuity Act
is to be paid, then, no such settlement or contract is permissible
under the Payment of Gratuity Act. Therefore, this alleged settlement
is not binding to 25 workmen those who are employees of petitioner
and in whose favour, Controlling Authority has passed the order
against the petitioner on 4th
July 2008. Therefore, contentions raised by learned advocate Mr.
Upadhyay relying upon aforesaid settlement with only Union
Representative cannot be accepted, because, it is contrary to
provisions of Payment of Gratuity Act as well as prima facie it is
found to be a collusion with Union Representative and employer both
belong to one caste. The Union Representative has not filed any
affidavit before either of Authority that workmen have authorised him
and payments were made to concerned employees as per alleged
settlement dated 26th
August 2008.
11. The
Appellate Authority has rejected the appeal by order dated 29th
July 2009 while considering provisions of Sec.7(7) of Payment of
Gratuity Act. The appeal is required to be preferred by employer
against order passed by Controlling Authority within a period of 60
days from date of receiving copy of order passed by Controlling
Authority and thereafter, further 60 days, for which, Appellate
Authority can condone it in filing appeal and second condition is
that along with appeal, there is a precondition to deposit an amount
directed by Controlling Authority either before Controlling Authority
or before Appellate Authority. The present petitioner has not filed
appeal within 120 days from date of receiving copy of order passed by
Controlling Authority. The Appellate Authority has no power to
condone delay beyond period of 120 days in all. The order passed by
Controlling Authority dated 30th
June 2008 and petitioner on 14th
July 2009 means after a period of more than one year had preferred an
appeal, therefore, it has been rejected.
12. Learned
advocate Mr. Prabhakar Upadhyay has not made any submission in
respect of merits of the matter as to whether workmen are entitled
amount of gratuity as claimed or not. Learned advocate Mr. Upadhyay
is also not able to point out as to why petitioner remained absent
before Controlling Authority. He is also not able to justify by
giving sufficient cause for remaining absent before Controlling
Authority and there is no submission at all made that workmen are not
entitled at all amount of gratuity from petitioner as directed by
Controlling Authority. There is no submissions made on merits by
Learned Advocate Mr. Upadhyay.
13. I
have considered submissions made by learned advocate Mr. Prabhakar
Upadhyay appearing on behalf of petitioner and I have also scanned
the entire papers annexed to this petition.
14. The
procedure for filing appeal is prescribed in Rule 18 of Payment of
Gratuity (Central) Rules, 1972. Employer’s appeal must be accompanied
by certificate of deposit. Deposit of gratuity amount either before
Controlling Authority or before Appellate Authority is mandatory for
filing of appeal against order of Controlling Authority. [See
: 1990 LLR 28 (Madras High Court) Onward Trading Co., Madras v.
Dy. Commissioner of Labour, Madras].
Employer
preferred the appeal within time but without producing the
certificate of deposit of gratuity amount, issued by the Controlling
Authority under Sec.7(4) of the Act, Appellate Authority ordered the
appeal to be consigned as it was not in accordance with law. The
appeal against order of Controlling Authority after the prescribed
period of limitation will not be maintainable. [See
: 1994 LLR 894 (Bombay High Court) Gurudeo Ayurved Mahavidyalaya
Gurukul Ashram v. Madhav].
At the time of preferring an appeal and if there is no deposit of the
amount, there is no valid appeal. In case when amount is not
deposited as ordered by Controlling Authority within limitation of
120 days, then, appeal is
barred by limitation and untenable. [See : 2006
(II) CLR 572 : 2006 LLR (SN) 874 : 2006 (III) LLJ 686 : 2006 (III)
FLR 466 (Bombay High Court) Metal Box India Ltd. v. B.R. Rangari,
Addl. Commissioner of Labour].
The Appellate Authority has no power to condone the delay beyond 120
days. The Payment of Gratuity Act is a special statute and there is
provision for condonation of delay by extending period of 60 days by
another 60 days. There is no provision for further condonation of
delay. In the absence of conferment of jurisdiction to condone
further delay, the statutory authority which is a quasi-judicial
authority cannot condone delay or extend the period of limitation. [
See : 2000 (86) FLR312 (Madhya Pradesh High Court) Western
Coalfields Ltd. v. Controlling Authority].
15. Earlier,
the Calcutta High Court has also held that Appellate Authority under
Sec.7 of Payment of Gratuity Act is not a Court but an Executing
Authority who has been vested with quasi-judicial powers in order to
enable it to act as Appellate Authority and therefore, Section 5 of
the Limitation Act cannot be invoked and provisions of Limitation Act
do not apply to personal designate or administrative authorities.
[See : (1987) 1 LLJ 41 (Calcutta High Court)
City College v. State of West Bengal].
The Payment of Gratuity Act prevails over Limitation Act. The appeal
filed after lapse of 13 months from that date of original order was
already barred by the time even after allowing the time spent in
unsuccessfully pursuing writ petition. As such the order of
Controlling Authority directing payment of gratuity is to be held
final. [See : (I) 2007 (1) CLR 984 (Karnataka
High Court) K.V. Rama Rao v. Prashant Theatre, Tumkar (ii) 2003
LLR 242 (AP High Court) Liquidator, Warangal Distt. Co-op.
Society Ltd., Warangal v. Appellate Authority under Payment of
Gratuity Act, 1972/Dy. Commissioner of Labour, Warangal (iii) 2000
LLR 881 (Madhya Pradesh High Court) Western Coalfields Limited v.
Controlling Authority (iv) 2003 LLR 61 (AP High Court) Warangal
Distt. Co-operative Society Ltd. v. Appellate Authority under Payment
of Gratuity Act, 1972].
16. Right
of appeal under Sec.7(7) becomes vested right only when precondition
of deposit is complied with. The Appellate Authority is not to admit
appeal unless at the time of preferring appeal, the appellant either
produces a certificate of the Controlling Authority to the effect
that the Appellant has deposited with the Authority amount of
gratuity required to be deposited under Section 7(4) or deposit such
amount with the Appellate Authority. In such circumstances,
Appellate Authority has no discretion to admit/accept the appeal
unless condition incorporated is satisfied by appellant. It is not
the case of petitioner before this Court that precondition of deposit
the amounts as per order passed by Controlling Authority was
deposited by petitioner either before Controlling Authority or before
Appellate Authority.
17. The
provisions of Order XLI Rule 3A of the Code of Civil Procedure in
relation to appeals, for that, there is no express provision or there
is no indication made in the Payment of Gratuity Act that said
provision be read into the Act.
18. In
view of aforesaid law laid down by various High Courts and recent
decision of Apex Court that whenever statutory provision is made to
file appeal within particular period, then, in such cases, provisions
of Limitation Act is not made applicable as decided by Apex Court in
case of Commissioner of Customs and Excise v.
Hongo India Pvt. Ltd., and Another
reported in (2009)
5 SCC 791.
The relevant discussion is made in Para
10 to 15
are quoted as under :
10. Admittedly
in all these matters, the Commissioner of Customs & Central
Excise approached the High Court by way of reference application
beyond the prescribed period of 180 days. The High Court of
Allahabad, with reference to the scheme of the Act and in the absence
of specific provision for applying Section 5 of the Limitation Act,
took note of other provisions i.e., Sections 35, 35B and 35EE, which
enable the other authorities to condone the delay if sufficient cause
was shown, accordingly, dismissed the reference application filed by
the Commissioner of Central Excise on the ground of limitation.
11) Now
let us consider whether Section 5 of the Limitation Act is applicable
in respect of reference application filed in the High Court under
Section 35H of the unamended Act.
12)
Mr. Parag P. Tripathi, learned Additional Solicitor
General, appearing for the appellant contended that in view of the
fact that the High Court has all inherent and plenary power, is
competent to consider the delay even after the prescribed period
under the Act. He further contended that in the absence of specific
prohibition in the Act for condoning delay particularly in Section
35H in lieu of Section 29(2) of the Limitation Act, Section 5 of the
Limitation Act is applicable and the High Court ought to have
exercised its power by condoning the delay. He initially contended
that since Section 35H speaks about the substantial question of
public importance, even the delay, if any, has to be condoned.
13)
On the other hand, learned counsel appearing for the respondents
supporting the stand taken by the High Court submitted that the
Central Excise Act is a self-contained Act and a Code by itself and
in the absence of specific provision enabling the High Court to
exercise its power by condoning the delay, the High Court is
justified in refusing to entertain the reference application of the
Excise Department filed beyond the prescribed period. He also
contended that in the light of the scheme of the Act and of the fact
that sufficient period, i.e, 180 days, has been provided for the
Commissioner as well as the other party for making reference to the
High Court, the legislative intent has to be respected.
14)
Article 214 of the Constitution of India makes it clear that there
shall be a High Court for each State and Art. 215 states that every
High Court shall be a court of record and shall have all the powers
including the power to punish for contempt of itself. Though we have
adverted to Section 35H in the earlier part of our order, it is
better to extract sub-section (1) which is relevant and we are
concerned with in these appeals :
“35H.
Application to High Court – (1) The Commissioner of Central Excise or
the other party may, within one hundred and eighty days of the date
upon which he is served with notice of an order under section 35C
passed before the 1st day of July, 2003 (not being an
order relating, among other things, to the determination of any
question having a relation to the rate of duty of excise or to the
value of goods for purposes of assessment), by application in the
prescribed form, accompanied, where the application is made by the
other party, by a fee of two hundred rupees, apply to the High Court
to direct the Appellate Tribunal to refer to the High Court any
question of law arising from such order of the Tribunal.”
Except
providing a period of 180 days for filing reference application to
the High Court, there is no other clause for condoning the delay if
reference is made beyond the said prescribed period.
15)
We have already pointed out that in the case of appeal to the
Commissioner, Section 35 provides 60 days time and in addition to the
same, Commissioner has power to condone the delay up to 30 days, if
sufficient cause is shown. Likewise, Section 35B provides 90 days
time for filing appeal to the Appellate Tribunal and sub-section (5)
therein enables the Appellate Tribunal to condone the delay
irrespective of the number of days, if sufficient cause is shown.
Likewise, Section 35EE which provides 90 days time for filing
revision by the Central Government and, proviso to the same enables
the revisional authority to condone the delay for a further period of
90 days, if sufficient cause is shown, whereas in the case of appeal
to the High Court under Section 35G and reference to the High Court
under Section 35H of the Act, total period of 180 days has been
provided for availing the remedy of appeal and the reference.
However, there is no further clause empowering the High Court to
condone the delay after the period of 180 days.
19. Recently,
the Division of Bombay High Court has also considered similar
question in case of Pharma
Base India Pvt. Ltd., Mumbai v. State of Maharashtra and Another
reported
in 2009-II-LLJ
458 (Bombay).
The relevant discussion is made in Para
9 to 12,
which are quoted as under :
9. Having
heard the learned counsel appearing for the respective parties and
having gone through the impugned order and Petition along with the
annexures thereto and the case laws cited by the learned counsel in
this regard, we are of the considered opinion that there is no merit
in the Appeal. Sub-Clause 7 of the Section 7 reads as follows :
(7) Any
person aggrieved by an order under sub-section (4) may, within sixty
days from the date of the receipt of the order, prefer an appeal to
the appropriate Government in this behalf;
Provided
that the appropriate Government or the appellate authority,
as the case may be, may, if it is satisfied that the appellant was
prevented by sufficient cause from preferring the appeal within the
said period of sixty days, extend the said period by a further period
of sixty days;
Provided
further that no appeal by an employer shall be admitted unless at the
time of preferring the appeal, the appellant either produces a
certificate of the controlling authority to the effect that the
appellant has deposited with him an amount equal to the amount of
gratuity required to be deposited under sub-section (4), or deposits
with appellate authority such amount.
10. The
plain reading of above said proviso will reveal that any person
aggrieved by an order, under sub-clause 4 of section 7, may within 60
days from the receipt of the order, prefer an Appeal to the Appellate
Authority. However, the Appellate Authority is at liberty, if a
sufficient cause is shown, to extend the period of 60 days for
further period of 60 days. The Second proviso of Section 7(7)
provides that no Appeal by an employer shall be admitted unless, at
the time of preferring an appeal, the Appellant either produce a
certificate of controlling authority to the effect that the Appellant
has deposited with him an amount equal to the amount of gratuity,
required to be deposited under Section 7(4) with the Appellate
Authority or deposit with the Appellate Authority such amount. Thus,
this proviso has imposed fetter on the employers right to file an
Appeal. It is amply clear, that employer is obliged to deposit the
amount or produce the certificate of the controlling authority as the
case may be at the time of preferring an Appeal.
11.
In the background of above legal provisions, now let us consider the
facts of the present case. There is no dispute of the fact that the
Petitioner received copy of the order of controlling authority on
27/10/2006. There is also no dispute that Petitioner applied for the
certified copy and received the same on 10/11/2006. In view of the
provisions of Sub-Section 7 of Section 7, limitation would start to
run from the date of receipt of the order and in this case limitation
would start from 27/10/2007. We do not find any substances in the
contention of the learned counsel appearing for the Petitioner that
limitation would start to run from the date of receipt of the
certified copy. The Petitioner from 27/10/2006 to 10/11/2006 did not
apply for certified copy. For the first time the Certified Copy was
applied on 10/11/2006 and the same was delivered to him on the same
day. Therefore, at the most one day can be excluded which required to
obtain Certified Copy while computing of period of limitation of
either 60 days or further extended period of 60 days. The Petitioner
sent Appeal by speed post which was received by the office of the
Appellate Authority on 13/12/2006. However, along with this Appeal,
Petitioner neither produced the certificate of the controlling
authority to the effect that they have deposited with them an amount
equal to the gratuity required to be deposited under sub-Section 4 of
Section 7 nor deposited such amount with the Appellate Authority. In
our view, if the Petitioner wanted to challenge the order of
controlling authority, in that case, he was duty bound to produce the
certificate or deposit the amount as the case may be, at the time of
preferring an Appeal. Though the above dates show that the
Petitioners preferred an appeal within a period of 120 days,
mandatory deposit as contemplated under second proviso of Section
7(7) was not made within a period of 120 days. There is no dispute
that this deposit was made by the Petitioner on 12/03/2007.
Precondition of deposit at the time of preferring an Appeal being
mandatory, we are of the view that it is to be presumed that the
Petitioner filed Appeal only on 12/03/2007.
12.
Since the Petitioner received order of the controlling authority on
27/10/2006, his appeal is beyond the period of 120 days, even if it
granted the benefit of exclusion of time required for obtaining
certified copies. The issue before the Division Bench in J.L.
Morrison India Ltd.(supra) was whether the Appellate Authority under
the payment of Gratuity Act, 1972 can entertain the Appeal beyond 120
days from the date of receipt of the order?. After examining several
judgments including that of Apex Court, Division Bench concluded that
the Appellate authority under the said Act cannot entertain the
Appeal beyond 120 days from the date of receipt of the order. The
Division Bench also held that Section 5 of the Limitation Act would
have no Application, in this regard. In the facts and circumstances
mentioned above, we are of the clear view that the Appellate
Authority as well as the learned Single Judge of this Court rightly
upheld the Respondent No.2 s preliminary objection regarding
maintainability of the Appeal and there is no reason to interfere in
the said findings.
20. In
view of fact that absence of petitioner after receiving notice not
explained by petitioner or sufficient cause shown by petitioner.
There is no provision in Act which gives power to authority to review
earlier order or to set aside ex-parte order and appeal preferred by
petitioner beyond 120 days time barred and Appellate Authority has
not power to condone delay. The precondition to deposit amount as per
order of Controlling Authority not deposited by petitioner being
undisputed facts as well as in that view of aforesaid decision made
by this Court on the subject, the contentions raised by learned
advocate Mr. Prabhakar Upadhyay cannot be accepted. The order passed
by Controlling Authority in Gratuity Application, in Review
Application and by Appellate Authority in Appeal cannot consider to
be erroneous decision and Authorities concerned has not committed any
error which requires interference by this Court while exercising the
powers under Article 227 of the Constitution of India.
21. Therefore,
there is no substance in present petition, accordingly, present
petition is dismissed.
Sd/-
[H.K.
RATHOD, J.]
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