R. Rajendra Babu, J.
1. The short question for consideration was whether the Showroom Manager of the Kerala Co-operative Coir Marketing Federation Limited was an employee entitled to subsistence allowance under the Payment of Subsistence Allowance Act.
2. The 2nd respondent, Sri N.M. Mohandas was working as the Showroom Manager of the Kerala Co-operative Coir Marketing Federation in its Bangalore Showroom and was responsible for selling the stock of goods in the Showroom. He was suspended from service, pending disciplinary proceedings on 21st April 1995 alleging misappropriation of an amount of Rs. 2,15,603.93. On 3rd July 1997 he remitted back Rs. 20,000 and the Executive Committee of the Federation decided to reinstate him subject to the condition that he should remit the balance amount and the period of suspension shall be treated as break in service. Accordingly he was reinstated. Later the 2nd respondent filed a claim before the competent authority under the Payment of Subsistence Allowance Act for the period from 21st April 1995 to 26th January 1998 during which period he was under suspension. The competent authority passed Ext. P-1 order allowing the above claim and directed the petitioner to pay a total sum of Rs. 1,07,955. The Kerala State Go-operative Coir Marketing Federation Limited filed this O.P. challenging Ext.P-1 order dated 13th November, 2002 passed by the Deputy Labour Commissioner and Authority under Section 4 of the Payment of Subsistence Allowance Act, 1972.
3. Heard the learned Counsel appearing for both sides.
4. The main argument advanced by the learned Counsel for the petitioner was that the 2nd respondent was functioning as Showroom Manager of a branch of the petitioner establishment at Bangalore and as he was discharging managerial functions, he was not an employee as defined under the Payment of Subsistence Allowance Act and the authority under the above Act had no jurisdiction to pass an order directing the management 10 pay subsistence allowance. Admittedly, the 2nd respondent was the Manager of the Showroom of the petitioner establishment at Bangalore; The definition of an 'employee' under the payment of Subsistence Allowance Act would exclude persons employed in managerial or administrative capacity. The definition under Section 2(a) of the above Act would read:
'(a) 'employee' means any person employed in or in connection with the work of any establishment to do skilled, semiskilled or unskilled manual, supervisory, technical, clerical or any other kind of work for hire or reward, whether the terms of employment be express or implied, but does not include any sick person who is employed mainly in a managerial or an administrative capacity or as an out worker, that is to say, a person to whom any articles or materials are given out by or on behalf of the employer to be cleaned, washed, altered, ornamented of repaired by such outworker in any place not under the control and management of the employer.'
An employee discharging managerial functions or in an administrative capacity is excluded from the definition of an employee under the Act. The learned Counsel for the petitioner placed reliance on the decision of a Division Bench of this Court in Chittur Service Go-operative Bank Ltd. v. State of Kerala, 1992 (1) KLT 168, for substantiating the contention that the Payment of Subsistence Allowance Act cannot have any application with respect to employees discharging the managerial functions. There it was held:
'A person who is employed mainly in a managerial or administrative capacity is not an 'employee' for purposes of the Act. What is made relevant and what is required to be considered in deciding whether a person is employed in a managerial or administrative capacity is not his designation in the employment, but what exactly are the duties assigned to him by the employer. The designation is not conclusive. Nor the fact that a person though employed in a supervisory capacity, does some manual or clerical work as ancillary or incidental, to his employment. The main features, the pith and substance of the employment are the ones which fall to be considered. A Branch Manager occupies the highest position among all the employees in the branch and is in complete charge of the affairs of that branch. The entire responsibility of running the branch properly and efficiently rests on his shoulders. He has got a number of personnel working under him and it is his duty to oversee their work. The working of the branch and that of the staff therein are all subject to his supervision and control, it is his managerial skill, ability and leadership that plays the vital part in the effective operation of the branch. The role of the Branch Manager can hardly be called clerical and manual. His duties are mainly managerial, to be in control of the branch and its business, subject of course to supervision and control by the Head Office. But such control by the Head Office has no bearing on the question whether the Branch Manager is employed in a managerial or administrative capacity.'
5. In the Original Petition it was specifically alleged that the 2nd respondent was given independent charge of the showroom with complete supervision and control over the entire affairs and he was the sole custodian of the stock of the showroom with the right to purchase and sell the coir products. It was further alleged that the Manager was given authority to sanction leave of the ether employees of the showroom. These aspects were not specifically denied in the counter, but a vague contention was raised that he was only doing the clerical work. It is true that, he may be doing some clerical work in addition to the managerial functions. As he was discharging the functions of managerial character, he was not an employee coming within the definition of an employee under the Act and hence the provisions of the payment of subsistence allowance cannot have any application, so far as the 2nd respondent is concerned. The authority under the Payment of Subsistence Allowance Act can consider the claims of employees coming under the Act and grant subsistence allowance. But it has no jurisdiction to consider the claims and grant subsistence allowance in respect of the claims made by employees who are discharging managerial functions; As the petitioner was functioning as Manager of the Showroom of the petitioner establishment at Bangalore the authority under the Payment of Subsistence Allowance Act had no jurisdiction to consider the claim and grant the same and Ext.P-1 order passed by him was without jurisdiction.
6. The learned Counsel for the petitioner further submitted that the claim was made long after his reinstatement in service i.e., on 23rd December, 1999. As per the 1st proviso to Section 4 the application should be filed within one year from the date on which the money became due from the employer. The 2nd proviso says that the delay can be condoned. It was further submitted by the learned Counsel for the petitioner that the 2nd respondent had misappropriated a huge sum of money and on a domestic enquiry he was found guilty also, yet considering the precarious condition of the 2nd respondent, some leniency was shown to him and accordingly he was reinstated treating the period of suspension as break in service. When once, the period of suspension was treated as break in service, the period of suspension could not be treated as period of service. Subsistence allowance can be granted only treating the period of suspension as period of service. When once it was treated as break in service it had to be presumed that he was out of service. Section 3 of the Act deals with the payment of subsistence allowance during the period of suspension. The suspension period has to be treated as in service, in view of the definition of period of suspension under Section 2(d) of the Act. But there was an order passed by the management treating the period of suspension as break of service and that was not challenged by the employee, the above period had to be treated as out of service. The 2nd respondent had not preferred any claim during the period of suspension but only after the order passed by the Management treating the period of suspension as break of service. The case would have been different if he had claimed subsistence allowance during the period of suspension before passing of the order. But in the present case the claim was made only after an order passed by the management treating the period of suspension as break of service considering the difficulties of the 2nd respondent and permitting him to continue the employment though he was found guilty of misappropriation of a huge sum of money. When the suspension period was treated as put of service, the 2nd respondent cannot claim subsistence allowance for the period during which he was out of service. On that ground also, the 2nd respondent .was not entitled to any subsistence allowance. The authority under the Act did not consider all these aspects but passed an. order ignoring the above provisions of law, but proceeded to treat the period of suspension as break in service when there was a specific direction in the order that it would be treated as in service. Hence the order of the authority has only to be set aside.
In the result this O.P. is allowed. Ext. P-1 order passed by the Deputy Labour Commissioner and Authority under Payment of Subsistence Allowance Act is set aside.