ARALAM FARMING CORPORATION (KERALA) LTD v. P.V. ANTONY

WP(C).No. 34761 of 2011 (U) APPENDIX PETITIONER'S EXHIBITS:- EXT.P1COPY OF THE APPLICATION SUBMITTED BY THE FIRST RESPONDENT.EXT.P2COPY OF THE STATEMENT SUBMITTED BY THE PETITIONER.EXT.P3COPY OF THE ADDITIONAL STATEMENT SUBMITTED BY THE PETITIONER.EXT.P4COPY OF THE MINUTES OF THE MEETING HELD ON 05/01/2005AND 03/02/2005.EXT.P5COPY OF THE PAY REVISION ORDER DATED 25/04/2007.EXT.P6COPY OF THE ORDER DATED 29/06/2009 OF THE SECOND RESPONDENT IN G.C. NO.149 OF 2006.EXT.P7COPY OF THE ORDER OF THE THIRD RESPONDENTDATED 20/09/2011.RESPONDENT'S EXHIBITS:- NIL.//TRUE COPY// P.A. TO JUDGE rs. HARUN-UL-RASHID, J.------------------------W.P.(C).No.34761 Of 2011----------------------Dated this the 30th day of October, 2012.J U D G M E N TThe writ petition is filed seeking to set aside Ext.P6 orderpassed by the 2nd respondent to the extent it holds that theadhoc increase of Rs.325/- per month received by the 1strespondent would form part of wages for determining gratuitypayable under the Payment of Gratuity Act, for a declaration thatthe amount of Rs.325/- paid per month as adhoc increase wouldnot form part of wages for determining gratuity payable underthe Payment of Gratuity Act and for other incidental reliefs.2.The 1st respondent as applicant filed G.C.No.149/2006under Rule 10(1) of the Kerala Payment of Gratuity Rules,claiming Rs.10,916/- with interest from the respondent therein asbalance of gratuity and seeking a direction for payment. Therespondent denied the claim of the applicant. 3.The adhoc allowance of Rs.325/- was allowed to theemployees on the basis of the decision on the discussion beforethe Minister for Scheduled Caste/Scheduled Tribe, held on25.2.2005. The petitioner contended that prior to 1.1.2007 (pay ::2::W.P.(C).No.34761 Of 2011revision date) the increase of Rs.325/- was only adhoc allowancewhich falls within the exempted category of “other allowance”shown in the definition of wages and that in the minutes as wellas in Ext.R4 Government Order, it is clearly stated that the saidamount shall not be considered for any other purpose. Theapplicant maintained the stand that the adhoc increase is nothingbut part of wages and proportionate reductions are made in thesaid amount according to leave without allowance, as in the caseof basic pay and dearness allowance.4.The Controlling Authority held that the adhoc increaseis nothing but an interim increase in wages and that the saidincrease cannot be said as “any other allowance” shown in thedefinition of wages in Section 2(s) of the Payment of GratuityAct, but, only emoluments which are earned by an employeewhile on duty in accordance with the terms and conditions of hisemployment. The authority held that the adhoc increase is partof wages as defined under Section 2(s) of the Payment ofGratuity Act, and therefore, the applicant is entitled to getgratuity based on wages including the adhoc allowance. ::3::W.P.(C).No.34761 Of 20115.The learned counsel for the petitioner pointed out thatthe amount of Rs.325/- paid as adhoc allowance would not formpart of wages for calculation of gratuity in view of the fact thatthe said amount was being paid to the workers as per thedecision taken in the meetings held at the instance of the thenMinister on 5.1.2005 and 3.2.2005. It is pointed out that it iscategorically been decided that the adhoc allowance paid would inno manner be considered for any wage revision to beimplemented on a future date. Ext.P4 is the minutes of themeetings held on 5.1.2005 and 3.2.2005. The Government byExt.P5 order dated 25.4.2007 ordered revision of wages ofworkers of the farm with effect from 1.1.2007. It was specificallystated in the said order dated 1.1.2007, that the adhoc increaseof Rs.325/- would not be considered for any other purpose.Aggrieved by the order of the 2nd respondent, the petitionerpreferred appeal as G.A.C.No.597/2009 before the 3rdrespondent. It is submitted that the 3rd respondent withoutproperly appreciating the contentions put forth by the petitioner,dismissed the appeal. Ext.P7 is the copy of the order passed by ::4::W.P.(C).No.34761 Of 2011the 3rd respondent. G.A.C.No.600/2009 was filed by the 1strespondent against the rejection of the claim of the 1strespondent to count his service from 18.4.1975. The grievanceof the petitioner is that respondents 2 & 3 failed to take note ofExt.P5 Government Order sanctioning pay revision madeapplicable only with effect from 1.1.2007 and that the benefitsflowing out of the said order was applicable only to theemployees who were on the rolls of the farm as on 1.1.2007. Itis submitted that the 1st respondent was not on the rolls of thefarm on as on 1.1.2007 having availed VSS and left the service ofthe farm on 31.3.2006. Placing reliance on Ext.P5 GovernmentOrder it is contended that even assuming for the sake ofargument that by virtue of Ex.P5 Government Order, the adhocincrease paid to the workers was liable to be treated as part ofwages, the same would not be applicable to the 1st respondentsince he had left the service of the farm long prior to the issuanceof Ext.P5 order. It is contended that it is the settled principles oflaw that the benefits of pay revision flowing out of an orderissued after an employee voluntarily leaves the services of an ::5::W.P.(C).No.34761 Of 2011establishment cannot enure to his benefit. It is seen that thecontentions raised by the petitioner has not been seen consideredby the 3rd respondent while Ext.P7 order was passed. 6.In the circumstance, this Court is of the view that the3rd respondent shall reconsider the matter in the light ofcontentions raised by the petitioner relying on the decision takenin the meetings held on 5.1.2005, 3.2.2005 and Ext.P5Government Order. Accordingly, Ext.P7 order of the 3rdrespondent is quashed. There will be a direction to the 3rdrespondent to reconsider G.A.C.No.597/2009 and pass ordersafresh, after affording an opportunity of being heard to thepetitioner and 1st respondent. The appeal shall be disposed ofwithin a period of four months from the date of receipt of a copyof this judgment.The writ petition is disposed of as above. HARUN-UL-RASHID, Judge.bkn/-