High Court
Case Details
WP(C) 4799/2012 PRESENT HON’BLE MR JUSTICE UJJAL BHUYAN
Legal Reasoning
Heard Mr. N.Dhar, learned counsel for the petitioner and Mr. MH Rajborbhuyan, le arned counsel appearing for the Karimganj Municipal Board, Respondent Nos. 4 an d 5. Mr. B.J.Ghosh, learned Govt. Advocate, Assam appears for Respondent Nos.1a nd 2 and Mr. A.Chetri, learned Standing Counsel, Directorate of Pension and Publ ic Grievances, Assam for Respondent No.3. By way of this writ petition, petitioner seeks a direction to the Karimganj Mun icipal Board to pay his retiral benefits with interest. Case of the petitioner is that he joined as Tax Collector in the Karimganj Munic ipal Board (Board) on 1.5.1970. After rendering service for about 38 years, he r etired from service of the Board on 31.5.2008 on attaining the age of superannua tion as Lower Division Assistant. As per letter dated 3.7.2009 issued by the Exe cutive Officer of the Board, petitioner was informed that his retiral benefits were assessed at Rs.6,62,200.00, which included gratuity of Rs.2,14,00.00. Acco rding to the petitioner, he is entitled to an amount of Rs.10,30,500.00, the de tails of which as given in paragraph 10 of the writ petition are as under :- 1) 2) 3) 4) 5) 6) Stagnation : Rs. 20,049.00 Provident Fund : Rs.2,90,000.00 Gratuity : Rs.2,69,939.00 Leave Salary : Rs.1,23,130.00 Arrear Salary : Rs.3,13,589.00 D.A. : Rs. 13,793.00 Arrear of Total : Rs.10,30,500.00 Out of the aforesaid amount, he has been paid Rs.2,81,871.00. The balance amoun t due is Rs.7,48,629.00. Despite several representations, petitioner’s retiremen t dues have not been paid. Aggrieved, petitioner has filed the present writ petition seeking the reli ef as indicated above.
Decision
This Court by order dated 8.10.2012 had issued notice with the observation that pendency of the writ petition would not be a bar for the respondents to r edress the grievance of the petitioner. Respondent No.2, in his affidavit has stated that service of an e mployee in the municipalities in the State of Assam are governed by Section 50 of the Assam Municipal Act, 1956. Salary and other allowances are to be paid ou t of the municipal fund. Likewise, gratuity, pension etc. are also to be paid fr om the municipal fund. According to the said respondent, matter is between the petitioner and the Board. A joint affidavit has been filed by Respondent Nos.4 and 5. Whil e denying the claim of the petitioner that his outstanding retirement dues is R s.10,30,500.00, the said respondents have stated that total amount due to the pe titioner on his retirement stood at Rs.7,44,885.00. An amount of Rs.3,68,733.00 has already been paid to the petitioner. Thus, an amount of Rs.3,76,152.00 is du e to be paid to the petitioner. It is further stated that additionally, an amoun t of Rs. 5000.00 per month is being paid to the petitioner till receipt of fund from the Government. The said respondents have stated that the Board has moved t he Government for funds and as soon as funds are made available, the outstand ing dues of the petitioner would be paid. It is stated that because of paucity o f fund, petitioner’s retiral dues could not be paid. Without commenting on the total claim of the petitioner, since ther e appears to be dispute between the parties on the actual entitlement, it may, h owever be noted that Respondent Nos.4 and 5 have admitted that an amount of Rs.3 ,76,152.00 is due to the petitioner. The outstanding dues of the petitioner incl udes the gratuity amount. Gratuity is a statutory right governed by the provisions of the P ayment of Gratuity Act, 1972. Gratuity cannot be withheld or forfeited, except for the reasons indicated and in the manner provided under sub-section(6) of s ection 4 of the said Act. As per sub-section(6), the gratuity payable to an empl oyee may be withheld or forfeited if the service of an employee is terminated o n account of misconduct which caused damage or loss or destruction of property belonging to the employer to the extent of such damage or loss or destruction as the case may be. Admittedly, the present case does not come within the ambit o f the aforesaid provision as the gratuity amount of the petitioner has been with held by the employer only on the ground of paucity of fund. As per section 7 of the said Act, as soon as gratuity becomes payable, the employer is required to determine the amount of gratuity and thereafter to inform the employee in writin g about the gratuity so payable. The employer shall arrange to pay the amount of gratuity within thirty days from the date when it becomes payable, failing whic h it will carry simple interest at such rate as may be notified by the Central G overnment from time to time for repayment of long term deposits. It is well settled that pension and gratuity are not bounties to be di stributed by the employer to the employee at his own convenience. If the retire ment dues of an employee is not paid promptly, imposition of interest on such du es would be justified. In fact, the employees right to interest on delayed payme nt of gratuity is statutory since the Payment of Gratuity Act, 1972, which is a beneficial piece of legislation, itself envisages grant of interest on delayed p ayment of gratuity. Paucity of fund of the Board can be no justification to wit hhold the retirement dues of the petitioner. As per section 50(3) and (4) of the Assam Municipal Act, 1956, payment of gratuity or pension and provident fund ar e to be made by the Municipal Board from out of its fund. It has been held by th e Hon’ble Apex Court that establishments which have no capacity to give to thei r workmen the minimum conditions of service prescribed by the statute have no ri ght to exist. Thus, withholding of gratuity and other retirement dues would not be permissible on the ground of financial incapacity of the employer to bear th e burden. In view of above, respondent Nos.4 and 5 are directed to release the bala nce admissible retirement dues of the petitioner with simple interest @ 6% per annum from the date the dues became payable till final payment. Respondent Nos .4 and 5 shall carry out the exercise as indicated above within a period of 2(tw o) months from the date of receipt of a certified copy of this order. Writ petition stands disposed of.