Court No. - 36
Case :- WRIT - C No. - 23142 of 2018 Petitioner :- Allahabad Bank Respondent :- Radha Raman Bajpai And 2 Others Counsel for Petitioner :- Pashupati Nath Tripathi Counsel for Respondent :- A.S.G.I.,Anil Kumar,Manav Chaurasia
Hon'ble Mrs. Sunita Agarwal,J.
Counter affidavit filed today is taken on record. Heard learned counsel for the parties.
The present writ petition is directed against the order dated 28.7.2017 passed by the Controlling Authority as also the order dated 27.4.2018 passed by the appellate authority under the provisions of Payment of Gratuity Act, 1972 (hereinafter referred to as "the Act, 1972").
By means of the orders impugned, the Controlling Authority as also the appellate authority had directed for payment of gratuity amounting to Rs. 65,258/- with 10% simple interest from 10.6.1996 till the date of payment to the applicant within 30 days from the date of receipt of the order, subject to the condition that the amount of interest payable under the order shall not exceed the amount of gratuity payment under the Act.
The categorical submission of learned counsel for the petitioner is that the gratuity was not payable to the respondent no. 1 under the Act, 1972, inasmuch as, the services of the respondent no. 1 has been terminated on 10.6.1996 on the ground of financial misappropriation. The order of dismissal dated 10.6.1996 has been placed before the Court to demonstrate that the charges against the respondent no. 1 were serious in nature and the misconduct under Regulation 4(h) of the Allahabad Bank Officers Employees (Discipline and Appeal) Regulations, 1976 was found proved.
Further the order of dismissal was affirmed in a departmental appeal filed by respondent no. 1 dismissed on 16.6.1999. Writ-A No. 4053 of 2000 (Radha Raman Bajpai vs. Allahabad Bank and others) filed by respondent no. 1 challenging the dismissal order as also the order passed by the appellate authority has been dismissed on 7.4.2016. The result is that the dismissal order passed on the charges of financial embezzlement by the respondent no. 1 was affirmed upto this Court.
Learned counsel for the petitioner submits that during pendency of the writ petition before this Court, the respondent no. 1 pressed his demand for payment of gratuity. As a result, an intimation dated 7.6.2013 in Form 'M' issued under clause (ii) of sub-rule (1) of Rule 8 was given. The said notice rejecting the claim of payment of gratuity was served upon the petitioner. It was informed to the respondent no. 1 that on account of his dismissal from the service of the bank, as a result of wilful act of omission and commission causing huge loss to the bank, the entire amount of gratuity to the tune of Rs. 65,258/- stands forfeited under Section 4(6) of the Act, 1972.
At this stage, the respondent no. 1 approached the Controlling Authority under the Act, 1972 for release of gratuity amount whereupon the orders impugned dated 28.7.2017 and 27.4.2018 have been passed.
With reference to Section 4(1) of the Act, 1972, learned counsel for the petitioner submits that the gratuity is payable to him after he has rendered continuous service for not less than five years in three conditions namely:- (a) on his superannuation, or (b) on his retirement or resignation, or (c) on his death or disablement due to accident or disease. In case of termination of services of an employee on the ground of misconduct that too on the allegations of financial loss caused to the employer, the gratuity under Section 4(1) of the Act, 1972 is not payable.
Even otherwise, the dismissal order passed in the year 1996 categorically records that on account of act of omission and commission of the respondent no. 1, the bank had suffered financial loss to the tune of Rs. 3,82,00,000/- and odd. The said amount cannot be recovered from him. The gratuity is payable to an employee in recognition of his services with the department concerned. The order of forfeiture of gratuity passed under Section 6(4) is perfectly justified in the facts and circumstances of the present case.
The Controlling Authority as also the appellate authority had, thus, erred in holding that the employer bank could not have forfeited gratuity after 17 years from the date of dismissal. The observation of the authority that the employee was entitled for gratuity w.e.f. the date of dismissal i.e. 10.6.1996 is clearly in teeth of the provisions of Section 4(1) readwith sub-section (6) of the Act, 1972.
The learned counsel for the respondent no. 1, on the other hand, defended the orders impugned with the submission that no show cause notice whatsoever has been served upon the respondent no. 1 before forfeiture or withholding of gratuity, which was payable to him under the Act, 1972. Submission is that it was not open for the employer to pass order of forfeiture after 17 years of the date of dismissal.
Even otherwise, in case, opportunity would have been granted to the respondent no. 1, he would have submitted his explanation to demonstrate that no financial loss had been caused to the respondent bank and the order of forfeiture cannot be sustained on merits.
Having heard learned counsel for the parties and perused the record.
There is no dispute about the fact that the services of the respondent no. 1 has been terminated on the charges of his act of omission and commission while posted in the office of the bank.
The order of dismissal dated 10.6.1996 was passed after the full- fledged departmental enquiry conducted by the bank wherein the respondent no. 1 was granted opportunity of hearing. The dismissal order categorically records that on account of act of omission and commission of the respondent no. 1, the bank had suffered financial loss to the tune of more than three crores. The dismissal order has been affirmed by this court on a challenge made by the respondent no. 1. Thus, there can not be a dispute to the fact that the dismissal order passed in the year 1996 has attained finality and misconduct of the bank employee causing financial loss to the bank stood proved.
In the said circumstances, the gratuity as admissible under the payment of Gratuity Act was not payable, inasmuch as, sub-section (1) of Section 4 of the Act, 1972 contemplates three conditions in which gratuity can be paid i.e. in the case of superannuation, resignation, death or disablement. The claim of the petitioner does not fall in any of those conditions. Even otherwise, under sub- section (6) of Section 4, the employer is entitled to forfeit the gratuity payable to an employee, whose services has been terminated for any act of wilful omission or negligence causing any damages or loss to the bank.
Under clause (b) of sub-section (6) of Section 4 of the Act, 1972, it is open for the employer to forfeit whole or part of the gratuity payable to an employee for any act of misconduct or involving moral turpitude.
In the instant case, the gratuity of respondent no. 1 to the tune of Rs. 65,258/- has been withheld in accordance with the provisions of sub-section (6) of Section 4 of the Act, 1972 by passing the order dated 7.6.2013 with the categorical observations therein that for the wilful act of omission and commission of the respondent no. 1 causing huge loss to the bank, the entire amount of gratuity is being withheld. The Controlling Authority under the Payment of Gratuity Act did not find any fault with the decision taken by the employer in forfeiting the gratuity rather it has misdirected itself in holding that the order of forfeiture could not have been passed after a period of approximately 17 years from the date of dismissal.
The question as to whether the employee was entitled for gratuity under the Payment of Gratuity Act, 1972 has not been examined by the Controlling Authority. The appellate authority has also misdirected itself in holding otherwise.
In view of the above discussion, this Court is of the considered view that the order dated 28.7.2017 passed by the Controlling Authority and the order dated 27.4.2018 passed by the appellate authority cannot be sustained. Both the orders are hereby quashed.
The action of the petitioner/bank in forfeiting the gratuity of the respondent no. 1 is hereby upheld.
The writ petition is allowed. Order Date :- 27.7.2018/Brijesh