Judgment:
(Prayer: This writ petition is filed under Articles 226 and 227 of the Constitution of India praying to quash the orders passed by the R1 dated 17.03.2011 vide Annexure-B.)
1. Petitioner has sought quashing of order dated 17.03.2011 passed by the 1st respondent at Annexure-B, whereunder Deputy Labour Commissioner and Appellate Authority under the Payment of Gratuity Act, 1972, has dismissed the appeal filed by the Corporation on the ground of appeal having been filed beyond the period prescribed under the Act, namely beyond 120 days.
2. Heard Smt.S. Nirmmala, learned counsel appearing for the petitioner-Corporation, Sri.M.C. Basavaraju, learned counsel appearing for 3rd respondent and Sri.Jagadeesh Mundargi, learned Additional Government Advocate appearing for respondent Nos.1 and 2. Perused the impugned order and also order passed by the controlling Authority dated 12.03.2009 at Annexure-A and original records made available by the learned Additional Government Advocate.
3. The short point that arise for consideration in this writ petition is:
“Whether 1st respondent-appellate Authority was justified in dismissing the appeal on the ground that it is filed beyond the period of limitation as prescribed under Section 7(7) of the Payment of Gratuity Act, 1972.?”
4. 3rd respondent who was working in Petitioner-Corporation retired from service on attaining the age of superannuation on 30.09.1997 and he had received the gratuity amount. However, after a lapse of 11 years i.e., on 21.04.2008 petitioner filed an application before 2nd respondent claiming difference of gratuity on the ground there was short payment 2nd respondent after adjudicating the claim, by its order dated 12.03.2009-Annexure-A determined the difference amount payable by Corporation at Rs.1,80,955/- and directed petitioner Corporation to pay the said amount with simple interest at 10% p.a. from 1.11.2006 Aggrieved by said order, an appeal came to be filed by the Corporation before the 1st respondent, which is the appellate Authority under Payment of Gratuity Act. Said appeal came to be dismissed on the ground of delay namely it was held appeal filed by Corporation was beyond period of 120 days as prescribed under Section 7(7) of the Payment of Gratuity Act, 1972.
5. It is the contention of Smt.S.Nirmmala, learned counsel appearing for the petitioner-Corporation that order passed by the Controlling Authority determining the amount payable or directed to be paid to the workman/employee is required to be intimated to petitioner and same was not intimated to Corporation. She would submit that in the instant case matter was heard by the controlling Authority and it was reserved for orders on 19.02.2009 and thereafter on 12.03.2009 order at Annexure-A came to be passed without notice of hearing to the Corporation and no intimation has been delivered by 2nd respondent for having passed said order. She contends only when it was intimated by the workman. Corporation became aware of the order and immediately an application came to be filed by Corporation for grant of certified copy on 25.05.2009 and same was furnished on 15.09.2009 and within a period of 60 days from said date namely on 26.10.2009 appeal in question has been filed which is well within time and as such she contends that appellate Authority was not justified in rejecting the appeal on the ground that it was barred by limitation.
6. Per Contra, Sri.M.C. Basavaraju, learned counsel appearing for 3rd respondent-workman would submit that Corporation was aware of the order having been passed on 25.05.2009 itself since copy application was filed on the said date and period of limitation has to be reckoned from the said date and if so reckoned, appeal in question would be beyond the period of 120 days and as such he contends that judgment delivered by Division Bench of this Court in W.A.No.2055/2008 is squarely applicable whereunder it has been held if appeal filed beyond 120 days it has to be dismissed and submits said dicta laid down by division bench applies to the facts of the case and as such he seeks for dismissal of the writ petition.
7. Sri. Jagadeesh Mundargi, learned additional Government Advocate appearing for respondent Nos. 1 and 2 would also support the order dated 17.03.2011-Annexure-B passed by Appellate Authority-1st respondent and submits that period prescribed under Section 7(7) of the Gratuity Act cannot be extended for condoning the delay. As such he submits that appellate Authority has rightly followed the judgment of the Division Bench in not condoning the delay which is just and proper and as such he seeks for dismissal of the writ petition.
8. In view of the fact that learned advocates appearing for the respondents have relied upon the Division Bench judgment of this Court delivered in W.A.No.2055/2008 disposed of on 15.06.2009, it would be appropriate to extract the dicta laid down by the Division Bench which reads as under:
“2. Section 7 of the Act deals with determination of the amount of gratuity. Sub Section (7) of Section 7 provides for any person aggrieved by an order under sub Section (4), may within sixty days from the date of receipt of the order, prefer an appeal to the appropriate Government or such other authority as may be specified by the appropriate Government in this behalf. The proviso provides for 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. Therefore, when the statute provides a period of limitation, the application of Limitation Act is excluded. The Act provides in all a period of 120 days which the appellate authority can condone the delay. Admittedly, in this case, beyond 120 days, there is a delay of 18 days in filing the appeal. The appellate authority was justified in declining to condone the delay, as it has no authority under the statute. Therefore, the learned single Judge is right in rejecting the writ petition.”
9. In the above referred matter Division Bench was dealing with a appeal arising out of an order passed by learned single Judge of this Court who had declined to interfere with the order passed by the appellate Authority, which had dismissed the appeal on the ground of delay. While examining the provisions of Gratuity Act, namely Section 7(7) Division Bench on facts held that when statute provides period of limitation for filing an appeal applying provisions of the Limitation Act, 1963 does not arise and held said Act stands excluded. It has been further held that under Payment of Gratuity Act limitation prescribed for filing an appeal is 60 days at the first instance and within further period of 60 days appeal can be filed if sufficient cause is shown, which would mean that total period within which an appeal can be filed would be 120 days and as such period of limitation has to be construed.
10. On facts Division Bench held in the said case that appeal filed was beyond 120 days and hence it was barred by limitation and accordingly writ appeal came to be dismissed by affirming the order of the learned single Judge and also the order of the appellate Authority.
11. In order to examine as to whether the dicta laid down by the Division Bench of this Court is applicable to the facts and circumstances of the case on hand, it would be necessary to narrate the dates relating to the case on hand which would have a direct bearing on the issue and same are as under:
| Date | Particulars |
| 30.09.1997 | 3rd respondent retired from service of the Corporation and received Gratuity benefits. |
| 21.04.2008 | Application filed by 3rd respondent before the 2nd respondent – controlling authority, seeking determination of gratuity amount payable by Corporation on the ground there was short payment. |
| 12.03.2009 | Order passed by the controlling authority determining the gratuity amount payable to 3rd respondent. |
| 25.05.2009 | Copy application filed by the Corporation seeking grant of certified copy of the order. |
| 15.09.2009 | Date of delivery of certified copy of the order dated 12.03.2009-Annexure-A. |
| 26.10.2009 | Appeal filed by the Corporation before the first respondent appellate Authority. |
“7. Determination of the amount of gratuity;
(1) xxxxx
(2) xxxxx
(3) xxxxx
(4)(a) If there is any dispute to the amount of gratuity payable to an employee under this Act or as to the admissibility of any claim of, or in relation to, an employee for payment of gratuity, or as to the person entitled to receive the gratuity, the employer shall deposit with the controlling authority such amount as he admits to be payable by him as gratuity.
(4)(b) xxxxx
(4)(c) The controlling authority shall, after due enquiry and after giving the parties to the dispute a reasonable opportunity of being heard, determine the matter or matters in dispute and if, as a result of such enquiry any amount is found to be payable to the employee, the controlling authority shall direct the employer to pay such amount or, as the case may be, such amount as reduced by the amount already deposited by the employer.
(Emphasis supplied by me)
13. In the event of either party being aggrieved by the order passed by controlling Authority they would be entitled to challenge the same by preferring an appeal to the appellate Authority under Section 7(7) of the Gratuity Act. Such an appeal is required to be filed within 60 days from the date of receipt of the order and as per the first proviso to sub-Section (7) of Section 7 of the Act. However, if Appellate Authority is satisfied with the cause shown for not filing the appeal within 60 days it is empowered to condone the delay or entertain the appeal beyond the period of 60 days and not exceeding further period of 60 days. In otherwords the total period prescribed under the act for filing an appeal would be 120 days.
14. Section 7(7) and the proviso thereunder reads as under:
“7(7) Any person aggrieved by an order under sub Section (4) may, within sixty days from the date of receipt of the order, prefer an appeal to the appropriate Government or such other authority as may be specified by 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, extended the said period by a further period of sixty day.”
(Emphasis supplied by me)
15. In exercise of power vested under Section 15(1) of the Act, the Government has framed the Payment of Gratuity (Central Rules) 1972, whereunder the procedural aspect with regard to adjudication of claims as also the procedure to be adopted by the appellate Authority for adjudicating the appeal has been specified. Under sub Rule (4) of Rule 11 the controlling Authority on adjudication of a dispute/claim is required to furnish copy of its finding to each of the parties. The said sub-rule reads as under:
11.) Procedure for dealing with application for direction.-(1) On receipt of an application under Rule 10 the controlling authority shall, by issuing a notice in Form ‘O’, call upon the applicant as well as the employer to appear before him on a specified date, time and place, either by himself or through his authorised representative together with all relevant documents and witnesses, if any.
(2) xxxxx
(3) xxxxx
(4) After completion of hearing on the date fixed under sub-rule (1), or after such further evidence, examination of documents, witnesses, hearing and enquiry, as may be deemed necessary, the controlling authority shall record his finding as to whether any amount is payable to the applicant under the Act. A copy of the finding shall be given to each of the parties.
(Emphasis supplied by me)
16. Under Rule 17, the controlling Authority after recording its finding on the dispute or claim is also required to notify the employer concerned by specifying the amount payable and directing payment thereof to the workman or the employee as the case may be the amount so determined under Section 7(4) of the Act read with Rule 11(4) and the form prescribed for issuance of such notice is Form – ‘R’.
17. Thus, on a combined reading of section 7(4)(c), sub Rule (4) of Rule 14 and Rule 17 it would clearly go to show that on an adjudication made by the Controlling Authority and the amount determined to which an employee or the workman as the case may be is entitled to, same is required to be notified to each of the parties and particularly the employer is required to be notified by the Controlling Authority as to what is the actual amount determined and payable by it to a workman. Clause (c) of sub section (4) of section 7 mandates the Controlling Authority to direct the employer to pay such amount as determined by it. In other words the determination of the amount by the Controlling Authority and notifying the employer to pay/deposit the amount so determined by issuing notice on the employer for making payment is mandatory as otherwise employer would not be aware of the amount so determined. It is on receipt of said notice, an employer would become aware of such order having been passed by the Controlling Authority. Of course, unless the employer is already aware of such order having been passed by the Controlling Authority in any other manner.
18. Under sub section (7) of section 7. Appeal to the appropriate Government or such other authority is to be filed within 60 days from the date of receipt of the order. Under first proviso to sub-section (7) of section 7 the appropriate Government or the appellate authority as the case can extend the said period of limitation by further period of 60 days if it is satisfied that appellant was prevented by sufficient cause from preferring an appeal within said period of 60 days. In other words the outer limit within which the appropriate Government or the appellate authority can entertain an appeal would be 120 days and not beyond the said period. Thus, the question would be, when does the limitation starts to run namely; (i) whether it is from the date of the order or (ii) whether it is from the date of receipt of the order. Sub section (7) of section 7 is explicit and clear. It is from the date of receipt of the order. There cannot be any dispute on this issue since the words used in sub-section (7) of section 7 are clear and unambiguous. An order passed by the Controlling Authority under the Payment of Gratuity Act, as already noticed hereinabove is mandatorily required to be furnished to each of the parties as provided under sub rule (4) of Rule 11. Yet again, Rule 17 mandates that in the event of a finding is recorded under sub rule (4) of Rule 14 that an applicant is entitled to any amount of Gratuity, a duty is cast on the Controlling Authority to issue notice to the employer concerned in Form-R specifying the amount payable and directing payment/deposit thereof. Thus, aggrieved party would be able to prefer an appeal only on such order being notified or obtained by it and not otherwise. It is for this precise reason a specific Form has been prescribed under Rule 17 namely Form ‘R’, as referred to supra, which mandates the controlling authority to forward the decision arrived by it by determining the amount and notifying the employer to deposit the amount so adjudicated by it. As otherwise, the amount determined by it may not be within the knowledge of the employer, in as much as, on adjudication of a claim by controlling authority, as stated by the learned members of the Bar, the controlling Authority does not fix any specific date for pronouncement of its orders after conclusion of the arguments. On the other hand matter is reserved for pronouncement of orders without specifying a particular date. Thus, parties would not be aware of the date on which order would be pronounced. It is in this background statutory provision mandates that controlling Authority is required is required to notify the employer of the amount payable to workman, on such adjudication. It is in this background that the words used under sub section (7) of section 7 namely “may within 60 days from the date of receipt of the order” will have to be understood as starting point for the commencement of the period of limitation or in otherwords limitation commences from the date of order-copy is received. Thus, receipt of the order is the prime factor which would be relevant for the purposes of reckoning the period of limitation.
19. In this background, when facts on hand are examined with reference to the order sheet maintained by the controlling Authority as per the original records. It would clearly go to show that matter was argued on 19.02.2009 by the learned advocates appearing for both parties and it was reserved for orders on the said date. Perusal of order sheet at page No.4 does not reflect about any further date of hearing having been fixed on 19.02.2009. Order sheet also does not reflect that when order was pronounced on 12.03.2009 that parties or their respective learned advocates were present. In the absence of any date of hearing being given, it is not expected that learned advocates or parties would be present on the date of pronouncement. Thus, it cannot be held that parties to these proceedings were aware of the date on which order was pronounced.
20. It has been specifically contended by the Corporation before the appellate Authority, in its affidavit filed in support of the application seeking condonation of delay that Corporation came to know about the order having been passed only during May 2009, when it was intimated by its workman – 3rd respondent. I do not find any good ground to reject the said contention, in as much as workman has also not seriously disputed this fact. Thus, for all practical purposes, date 4 knowledge of the impugned order attributable to the petitioner would be only from 25.05.2009 and not any other date.
21. The learned Additional Government Advocate has been unable to demonstrate before this Court that order passed by the controlling Authority dated 12.03.2009 at Annexure-B has been communicated to the petitioner-Corporation. The records made available by the learned Additional Authority Advocate also does not disclose that controlling Authority had forwarded Form ‘R’ to the Corporation as required under Rule 17 of the Payment of Gratuity (Central) Rules or controlling Authority having forwarded its findings to the Corporation as required under Rule 11(4).
22. In the absence of such material, the only conclusion that can be drawn would be that petitioner-Corporation become aware of the order passed by the controlling Authority on 25.05.2009 as discussed herein supra. On the same day i.e., on 25.05.2009 petitioner has applied for certified copy of the order dated 12.03.2009 (Annexure-A) and same was furnished to it, on 15.09.2009. The original certified copy of the order produced along with the appeal memorandum by the Corporation before the appellate Authority, as also the endorsement made by the learned counsel appearing for the Corporation in the copy application as found in records would disclose that certified copy of the order dated 12.03.2009 at Annexure-A was furnished/and received to by the Corporation only on 15.09.2009 and appeal was filed on 26.10.2009.
23. In this background, when the limitation prescribed under Section 7(7) of the Payment of Gratuity Act, 1972 is examined, it would clearly go to show that certified copy of the order dated 12.03.2009 was furnished to Corporation on 15.9.2009 and appeal in question was required to be filed within 60 days from the date of receipt of certified copy of the order i.e., on or before 14.11.2009 i.e., excluding copying delay (From 25.5.2009 to 15.9.2009). Admittedly, in the instant case, appeal in question has been filed on 26.10.2009, which was well within the period of limitation as prescribed under Section 7(7) of the Act.
24. In view of the discussions made hereinabove, I am of the considered view that appellate Authority committed a serious error in dismissing the appeal on the ground of delay without going into merits and as such impugned order cannot be sustained.
25. In the result, following order is passed.
O R D E R
i) Writ petition is hereby allowed.
ii) Order dated 17.03.2011 at Annexure-B passed by 1st respondent is hereby quashed and appeal is restored to its file by remanding the matter back to 1st respondent-Authority with a direction to adjudicate the appeal on merits and in accordance with law by giving opportunity to both parties. Since workman is duly represented in these proceedings, he is hereby directed to appear before the 1st respondent appellate Authority on 23-04-2012 without awaiting for further notice from 1st respondent.
iii) No order as to costs.
iv) Ordered accordingly.