The question involved in the present writ petition is whether the writ petitioner who has put in sixteen (16) years of service as Secretary-cum-Clerk in the third respondent society from 05.11.1978 to 05.04.1995 is entitled to get gratuity or not?
2. It is mentioned that the petitioner after putting his service of sixteen years in the third respondent society, on 05.04.1995, resigned his job and consequently, joined as Assistant in the District Central Co-Operative Bank, Dindigul. Since the respondents did not settle the terminal benefits, to which he is legally entitled to, the petitioner made repeated requests and representations to pay the amount. Since all these efforts went in vain, he was constrained to raise a dispute under Section 90 of the Tamil Nadu Co-operative Societies Act before the second respondent. The second respondent without considering the case in proper perspective, was pleased to hold, that so far as the Provident Fund is concerned, he has put in less than ten (10) years of service and further held that he was eligible only for half of the contribution of the provident Fund. The second respondent did not even consider the long sixteen (16) years of service rendered by the petitioner and a perusal of the order would show that the second respondent has not applied his mind.
3. It appears that notices have been issued to the respondents and services were completed on the respondents. Neither they have taken steps nor anyone appeared for the first and third respondent, except the second respondent. I have heard the learned counsel for the second respondent. He has no submission in view of Section 4 of the Payment of Gratuity Act.
4. Prima facie, the case of the petitioner is that he has put in sixteen years and seven months of service in the third respondent society which is not properly considered by the second respondent. While so, the bye-law 16 of the society reads as follows:
" An employee who has completed 10 years of service retired or died in harness will be entitled to gratuity."
In this context, it is pertinent to read Section 4 of the payment of gratuity Act as extracted hereunder:-
1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years,-
a) On his superannuation, or
b) On his retirement or resignation, or
c) On his death or disablement due to accident or disease:
Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement:
[Provided further that in the case of death of the employee, gratuity payable to him shall be paid to his nominee or, if no nomination has been made, to his heirs, and where any such nominees or heirs is a minor, the share of such minor, shall be deposited with the controlling authority who shall invest the same for the benefit of such minor in such bank or other financial institution, as may be prescribed, until such minor attains majority.] The mere reading of Section 4 precisely indicates that the gratuity will be payable on the termination of his employment after completing the service of not less than five years.
5. Since the petitioner has rendered 16 years of service, the case of the petitioner is covered by Clause (b) of Section 4, which says that if any one retires from service after completing more than five years or resigns, is entitled to get gratuity. The problem in this case is that the authorities namely, the second and third respondents have taken care of only the bye-law which says a person who resigns does not deserves to get gratuity. The bye-law 16 of the Society cannot be given weightage in view of Section 4 of the Payment of Gratuity Act. Because, the latter will override the former bye-laws. There is a catena of judgments of the Apex Court jointly stare at my face to hold that any departmental letter or executive instructions or bye laws of society cannot prevail over statutory rule or Act. A Full Bench decision reported in 1992 suppl (1) SCC 150 (State of Madhya Pradesh V. Dall & Flour Mills) answers the issue raised by the petitioner. The Apex Court in the above said case has held as hereunder:
"19.The second ground on which the Full Bench has sought to invoke the instructions is also not correct. Executive instructions can supplement a statute or cover areas to which the statute does not extend. But they cannot run contrary to statutory provision or whittle down their effect."
6. It is a settled law that if there is any conflict between a statute and the subordinate legislation, it does not require elaborate reasoning to firmly state that the statue prevails over subordinate legislation and the bye-law if not in conformity with the statute in order to give effect to the statutory provision the rule or bye-law has to be ignored. The statutory provision has precedence and must be complied with. This view has been consistently followed by the Hon'ble Supreme Court in (1984) 2 SCC 50 (Babaji Kondaji Garad v. Nasik Merchants Co-op. Bank Ltd. and others). In another judgment reported in 1995 Suppl. (1) SCC 533 (Burmah Shell Coop. Housing Society Ltd. v. Chief Commissioner of Income Tax (Technical) New Delhi and others) the same view has been consistently followed and it says that if there is a conflict between bye- law of the cooperative societies and Act of Parliament, the Apex Court has held, the Act would prevail over the bye-law of the cooperative societies. In yet another latest judgment reported in (2007) 12 SCC 764 (Veena Kumari Tandon V. Neelam Bhalla and Others) the Hon'ble Supreme Court has held thus:
"11. It is now a well-settled principle of law that a legislative Act shall prevail over the subordinate legislation. Bye-laws must, therefore, conform to the provisions of the Act and cannot act in derogation thereof."
7. Though the relief in respect of payment of General Provident Fund and other retirement benefits were considered in proper lines, the refusal of the prayer of the petitioner for payment of gratuity is totally against the provisions of Section 4 of the Payment of Gratuity Act, 1972. Therefore, the Writ Petition has to be allowed on the basis of Section 4 of the Payment of Gratuity Act, 1972.
8. Therefore, I am of the considered view that the Writ Petition shall be allowed by quashing the impugned order to the extent it rejects the claim of the petitioner for gratuity and consequently, the respondents are directed to pay gratuity to the petitioner to which they are legally entitled to. Accordingly, the Writ Petition is allowed. Consequently, connected Miscellaneous Petition is closed. No costs.
DP To
1.The Principal District Court-cum-
Co-Operative Tribunal, Madurai.
2.The Deputy Registrar of Co-Operative Societies, Usilampatti at Thirumangalam, Madurai District.
3.The Special Officer, A.2793, Thirumal Primary Agricultural Co-Operative Bank, Thirumal PO, Madurai District.