Payment of gratuity Rs 687960 along with Rs 158195 as interest High Court put on hold amount deposited by Petitioner before Assistant Labour Commissioner, Reasi till final disposal of writ petition

Court of Controlling Authority under payment of gratuity Act 1972(Assistant Labour Commissioner Reasi had directed Chief Executive Officer, SMVDSB to make payment of Rs 687960 along with an interest of Rs 158195 @ 10% per annum with effect from Janak Singh’s superannuation
Earlier under Section 4(1) of the Payment of Gratuity Act 1972 , Court of Controlling Authority under payment of gratuity Act 1972 observed that an employee who has rendered continuous service for not less than five years for his employer is entitled to gratuity
Shrine Board was of the view that gratuity claim is not maintainable for non-joinder besides claiming that neither Janak Singh is an employee nor Shrine Board is an employer in terms of provision of Payment of Gratuity Act 1972
Board denied gratuity to Janak Singh on ground that it doesn’t fall within the ambit of establishment as no commercial activity is being carried by Board citing Circular No. CO/P/Cir/3831-53 dated 21-12-1992, gratuity is payable to the graded employee that is retirement, death while in service and leaving service after five years. Further that Mata Vaishno Devi Shrine Board is a statutory body having its own service bye-laws governing the conditions of services of its employees
GY CORRESPONDENT
jammu, apr 17
High Court of Jammu & Kashmir and Ladakh in its order WP(C) No. 727/2023, CM No. 1766/2023 in case titled Chief Executive Officer Shri Mata Vaishno Devi Shrine Board Katra and others V/s Janak Singh and others has ordered that amount deposited by the Janak Singh before the Assistant Labour Commissioner, Reasi shall not be released till final disposal of the writ petition.It deserves mentioning here that Court of Controlling Authority under the payment of gratuity Act 1972(Assistant Labour Commissioner Reasi in a case titled Janak Singh s/o Shanker Singh, Ex Sahayak, Shri Mata Vaishno Devi Shrine Board Katra Versus Chief Executive Officer, SMVDSB in a landmark decision dated 5-9-2022 vide File No. 08-PGA/R/2021 in view of legal and factual set up and under Section 7(3-A) Gratuity Act directed Shri Mata Vaishno Devi Shrine Board through its Chief Executive Officer to make payment of Rs 687960 along with an interest of Rs 158195 @ 10% per annum with effect from 19-5-2020 in favour of Janak Singh in this Court within period of 30 days from the date of passing of this order, failing which the same shall be recovered as an arrear of land revenue by invoking section 8 of Gratuity Act alongwith 15% per annum compounded interest from the date of order till its actual position.
It deserves mentioning here that Janak Singh s/o Shanker Singh, Ex Sahayak, Shri Mata Vaishno Devi Shrine Board Katra was denied gratuity as admissible under PG Act,1972 by Board. The Court further observed that as per available record,Janak Singh has served Shrine Board w.e.f 3rd of June 1992 to 18th of April 2020 that is period of approximately 28 years, therefore the quantum of gratuity which was payable to him on the part of Shrine Board within thirty days of his superannuation from services was Rs 687,960. Section 7(3A) provides for imposition of simple interest on the gratuity amount for the delay caused in making payment to employee. The central Govt notifies the rate of interest which is to be imposed on the gratuity payable and vide SO 874(E) dated 1st of October,1987 the same has been notified as 10% per annum.The reason for filing the suit was due to the arbitrary and mindless decision of the Chief Accounts Officer about the nonpayment of Gratuity to the superannuated employees on the ground that Shri Mata Vaishno Devi Shrine Board doesn’t fall within the ambit of establishment as no commercial activity is being carried by Board citing Circular No. CO/P/Cir/3831-53 dated 21-12-1992 issued by Shrine Board, gratuity is payable to the graded employee that is retirement, death while in service and leaving service after five years. Further that Mata Vaishno Devi Shrine Board is a statutory body having its own service bye-laws governing the conditions of services of its employees. It is worthwhile to mention here that when an employee has rendered his or her services for at least five continuous years and on his retirement, superannuation, resignation, death, or disablement, then the employee shall be eligible for payment of gratuity. In the recent judgement of The High Court of Karnatala has held that the payment of gratuity would not depend upon the employee filing an application before the employer demanding gratuity but it will have to be paid immediately on cessation of the employment. The gratuity will have to be paid immediately by the employer on cessation of employment in terms of Section 4 of the Payment Gratuity Act, 1972, irrespective of the demand by the employee, the Court said.
The Cour observed that Assistant Labour Commissioner, Reasi, as being controlling authority under the Payment of Gratuity Act, 1972, came to entertain and take cognizance of a claim petition filed under section 4 read with section 7(3-A) of the Payment of Gratuity Act, 1972 (in short, “the PG Act” 1972) on file no. 08-PGA/R/2021 dated 17.09.2021 by the respondent no. 1–Janak Singh for the purpose of adjudication of claim for the payment of gratuity in favour of the respondent no. 1 against the petitioners herein under the provisions of the PG Act of 1972.The petitioners, upon appearance in the case, came to reply and respond to the petition both on the facts and in law including an objection as being preliminary that the petitioner no. 1 i.e., Shri Mata Vaishno Devi Shrine Board, Katra was not an establishment under the PG Act of 1972.The Assistant Labour Commissioner, Reasi not only came to overrule the said preliminary objection of the petitioner no. 1 but also to proceed ahead to 2 pass an award dated 05.09.2022 thereby granting in favour of the respondent no. 1 an award of Rs. 6,87,960/- along with interest of Rs. 1,58,195/- @ 10% with effect from 19.05.2020 till 05.09.2022 as the date of passing of said award.
Against this award, the petitioners came to prefer a statutory appeal under section 7(7) of the PG Act of 1972 against said award dated 05.09.2022 of the Assistant Labour Commissioner, Reasi before the Appellate Authority i.e., the Deputy Labour Commissioner, Jammu on file no. 36-PGA-2022 on 04.11.2022, which came to be decided on 17.03.2023. In terms of appellate decision, the appeal filed by the petitioners came to be rejected thereby maintaining the award dated 05.09.2022 of the Assistant Labour Commissioner, Reasi awarding amount of Rs. 6,87,960/- along with an interest of Rs. 1,58,195/- in favour of the respondent no. 1.
The petitioners have come in the present writ petition to challenge the adjudication of the said two adjudicatory/forums below under the PG Act of 1972. The petitioners are seeking to examine the legality and validity of the same on the point that application of the PG Act of 1972 is carried out by reference to section 1 sub-section 3 with regard to Shops or Establishment/s governed by the Jammu and Kashmir Shops and Establishment Act, 1966 which the Shri Mata Vaishno Devi Shrine Board Katra is not at all as an establishment in that context and, the initiation of proceedings under the PG Act, 1972 at the instance of the respondent no. 1 was misplaced and misconceived besides other grounds.Court asked Janak Singh to furnish registered postal covers within a period of fifteen days whereupon the Registrar Judicial, Jammu to issue notices to the respondents.The next date of hearing has been fixed on 12.05.2023