2. By this petition, the petitioner has challenged the order dated 31.8.2005 passed by respondent no.2/Controlling Authority/Deputy Labour Commissioner, Uttar Pradesh, Gorakhpur in Case No.G.R.P.G.02/2004 Smt. Anwari Begam Widow of Late Shahid Ali Vs. M/s Executive Engineer, Electrical and Mechanical Division, Public Works Department Gorakhpur, whereby a direction has been given for payment of an amount of Rs.16182/- along with interest at the rate of 8% per annum w.e.f. 18.11.1997, as gratuity payable to the deceased Shahid Ali, to the respondent No. 1.
3. The brief facts of the case are that a claim petition was filed on 14.1.2004 under the provisions of Payment of Gratuity Act, 1972 (hereinafter referred to as 'the Act') before Controlling Authority under the said Act i.e. Deputy Labour Commissioner, Gorakhpur, with the assertion that the husband of respondent no.1 namely Shahid Ali was employed as electrician in work-charged establishment of Electrical and Mechanical Division, Public Works Department, Gorakhpur since April, 1986 and died on 18.10.1997 while in service/employment of the petitioner. At the time of his death he was drawing an emolument of Rs.5000/- per month. It was stated that an amount of Rs.31,730/- was payable as gratuity to him from the petitioner. The claim of respondent no.1 was contested by the petitioner before the Controlling Authority. The stand taken against the claim of respondent no.1 by the petitioner was that Late Shahid Ali was neither employee of an 'industry' nor of 'factory' nor he was covered under the provisions of the Act. The employees of the petitioner were treated as Government servants and were entitled to payment of emoluments as per Financial Rules applicable and provisions of the Act were not applicable to them. It was further stated that the salary of Late Shahid Ali as last drwan was Rs.2775/- per month. Therefore, at any rate the alleged claim of respondent no.1 is not admissible at all.
4. After having heard learned counsel for the parties and having gone through record the Controlling Authority-respondent no.2 has passed the impugned order dated 31.8.2005, holding that late Shahid Ali was entitled for payment of gratuity under the Act, accordingly he gave a direction for payment of gratuity to the respondent no.1 in the tune of Rs.16,182/- with interest at the rate of 8% per annum w.e.f. 18.11.1997. A certified copy of the impugned order is on record as Annexure-1 of the writ petition.
5. It is contended by learned standing counsel for the petitioner that while deciding the case the respondent no.2 did not decide the question of applicability of the provisions of the Act in respect of the case in question and urged that the Controlling Authority did not address himself to the provisions contained in Financial Hand Book Volume-VI Para 668 and 669 which clearly laid down that the work-charged employee is not entitled to any pension/leave salary/allowances. Admittedly Late Shahid Ali was work charged employee in the establishment of the petitioner and had not become regular employee before his death. Therefore, he was not entitled to any pension or gratuity under the provisions of the Act, thus, no claim under the provisions of the Act could be entertained by the respondent no.2.
6. Contrary to it, Sri Samir Sharma learned counsel for respondent no.1 has contended that the application of provisions of Act are not confined merely to the employees of factory, Mine Oil Field, Plantation, Port and Railway Company only, rather they shall apply to every shop or establishment within the meaning of any law for the time being in force in relation to shops and establishments in a state in which ten or more persons are employed or were employed on any day of the preceding twelve months and such other establishments notified by Central Government. Thus establishment in question is covered by the Act and that Late Shahid Ali was work-charged employee and had not held any post under the State Government and further since he was admittedly not governed by any Act or rules providing for gratuity, therefore, he was entitled for payment of gratuity under the Act and on his death, the respondent no.1 being his widow and heir is entitled for the same.
7. While repelling the contentions of learned counsel for the petitioner, Sri Samir Sharma further contended that assuming that under the provisions of Para 668 and 669 contained in Volume-VI of U.P. Financial Handbook, being a work-charged employee, Late Shahid Ali/husband of the respondent no.1 was not entitled for any pension, leave salary etc. and he was not entitled for gratuity under any rules applicable to the Government employees, even then since the provisions of the Act have overriding effect upon such other rules, therefore, he was entitled for payment of gratuity under the Act for reason that he had not held any post under the Central Government or State Government and was not governed by any other Act or any rules providing for payment of gratuity. In support of his aforesaid contentions he has placed reliance upon certain provisions of the Act and decisions of Apex Court and High Court which shall be referred hereinafter.
8. Having heard learned counsel for the parties and on perusal of the record, it is not in dispute that late Shahid Ali was work-charged employee in the work-charged establishment of petitioner since April 1986 till his death on 18.10.1997 and served for a period of more than 11 years before his death, therefore, the questions arise for consideration are that as to whether "work-charged establishment" of Public Works Department, Gorakhpur is an "establishment" within the meaning of Section 1 (3) (b) of the Act and Late Shahid Ali/husband of the respondent no.1 was "employee" within the meaning of the said Act?
9. In order to answer these questions first of all it is necessary to examine the provisions of Para-667 to 669 contained in Volume-VI of U.P. Financial Hand-Book which are as under:-
WORK-CHARGED ESTABLISHMENT Conditions of Employment
667. Work-charged establishment will include such establishment as is employed upon the actual execution, as distinct from the general supervision, of a specific work or of sub-works of a specific project or upon the subordinate super-vision of departmental labour, stores and machinery in connection with such a work or sub-works. When employees borne on the temporary establishment are employed on work of this nature their pay should for the time being, be charged direct to the work.
668. In all cases previous sanction of the competent authority as laid down in Volume I of the Handbook or in the departmental manuals of orders is necessary, which should specify in respect of each appointment (1) the consolidated rate of pay, (2) the period of sanction, and (3) the full name ( as given in the estimate) of the work and the nature of the duties on which the person engaged would be employed.
669. Members of the work-charged establishment are not entitled to any pension or to leave salary or allowances except in the following cases :
(a) Wound and other extraordinary pensions and gratuities are in certain cases admissible in accordance with the rules in Part VI of the Civil Service Regulations.
(b) Travelling and daily allowance may be allowed by divisional officers for journeys performed within the State in the interest of work on which the persons are employed on the following conditions :
(i) The journey should be sanctioned by the divisional officer or the sub-divisional officer/assistant engineer specifically authorised for the purpose by the divisional officer;
(ii) the concerned officer while sanctioning the journey should also certify that the journey is actually necessary and unavoidable in the interest of the work on which the person is employed;
(iii) for the journeys so performed the work-charged employee may be allowed travelling and daily allowance at the same rates and on the same conditions as are applicable to a regular government servant of equivalent status.
(4) All facilities and concessions admissible to workmen of factories registered under the Factories Act, 1948, are also admissible to the employees of the registered State Workshops and factories."
10. Section -1 (3) of the Act deals with the establishments to which the provisions of the Act shall apply. For ready reference it would be useful to extract the provisions of Section 1 of the Act 1972 in extenso as under:-
"1. Short title, extent, application and commencement.- (1) This Act may be called the Payment of Gratuity Act, 1972.
(2) It extends to the whole of India :
Provided that in so far as it relates to plantations or ports, it shall not extend to the State of Jammu and Kashmir.
(3) It shall apply to-
(a) every factory, mine oilfield, plantation, port and railway company;
(b) every shop or establishment within the meaning of any law for the time being in force in relation to shops and establishments in a State, in which ten or more persons are employed, or were employed, on any day of the preceding twelve months;
(c) such other establishments or class of establishments, in which ten or more employees are employed, or were employed, on any day of the preceding twelve months, as the Central Government may, by notification, specify in this behalf.
{(3-A) A shop or establishment to which this Act has become applicable shall continue to be governed by this Act notwithstanding that the number of persons employed therein at any time after it has become so applicable falls below ten.} (4)It shall come into force on such date as the Central Government may, by notification, appoint."
11. From a careful and joint reading of provisions of Para 667, 668 and 669 of Vol-VI of U.P. Financial Handbook it is clear that work-charged establishment includes such establishment which is employed upon the actual execution of a specific work or sub works of a specific project or upon the subordinate supervision of the departmental labour, stores and machinery in connection with such a work or sub works. Work-charged employees are usually employed for aforesaid nature of work with previous sanction of competent authority on consolidated rate of pay and their pay are charged direct to the work. The members of work charged establishment are not entitled to any pension or leave salary or allowances except in certain circumstances enumerated in para 669.
12. At this juncture it is to be noted that the provisions contained in aforesaid Volume- VI of U.P. Financial Handbook are subsidiary and financial rules of Government and also the rules made by Comptroller and Auditor General containing his directions under Article 150 of the Constitution and under the rules issued under para 11 (3) of Government of India Audit and Account Order 1936 as adapted by India (Provisional Constitution) Order 1947 prescribing the methods or principles in accordance with which accounts are to be kept in department and rendered to the Accountant General on prescribed dates and also the forms in which the accounts are to be maintained and rendered to the Accountant General. Thus, in my opinion, the aforesaid provisions contained in Financial Handbook are law for time being in force in relation to work-charged establishment in a State. Therefore, the work-charged establishment of Public Works Department of Government of U.P. (Gorakhpur) is an establishment within the meaning of aforesaid provisions of law for time being in force in relation to an establishment in State of U.P..
13. The view taken by me also finds support from State of Punjab Vs. The Labour Court, reported in 1979 (39) F.L.R. 353 wherein Hon'ble Apex Court while dealing with the provisions of Section 1 (3) (b) of the Act observed that Section 1 (3) (b) speaks for any law for the time being in force in relation to shops and establishments in a State. The expression is comprehensive in its scope, and can mean a law in relation to shops as well as, separately, a law in relation to establishments. Had the intention of Parliament been to refer to a law relating to any particular establishment, it would not have left the expression "establishments" unqualified. Thus, the Apex Court held that the Hydel Department of Government of Punjab, which had undertaken Project described as "Hydel Upper Bari Doab Construction Project" was establishment within the meaning of provisions of Section 1(3) (b) of the Act.
14. Further it is not in dispute that in the work-charged establishment of P.W.D. Gorakhpur more than ten persons were employed on any day preceding twelve months on the relevant date. Therefore, by applying the ratio of aforesaid case, I do not find any difficulty in accepting that work-charged establishment of Public Works Department of Government of Uttar Pradesh is an establishment within the meaning of Section 1(3) (b) of the Act.
15. Now coming to the another question as to whether Late Shahid Ali was "employee" within the meaning of the Act? Section 2 of the Act defines various 'words' and 'expressions' used under the Act. The expression 'employee' has been defined under Section 2 (e) of the Act as under:-
"Section-2 (e)"employee" means any person (other than an apprentice) employed on wages, in any establishment, factory, mine, oilfield, plantation, railway company or shop, to do any skilled, semi-skilled, or unskilled, manual, supervisory, technical or clerical work, whether the terms of such employment are express or implied, { and whether or not such person is employed in a managerial or administrative capacity, but does not include any such person who holds a post under the Central Government or a State Government and is governed by any other Act or by any rules providing for payment of gratuity}."
16. Thus, from the aforesaid definition clause it is clear that expression "employee" covers any person employed on wages in any establishment, factory, mine, oil field, plantation, Railway company or shop to do any skilled or semi skilled or unskilled, manual, supervisory, technical or clerical work whether or not such persons are employed in a managerial or administrative capacity but does not include "any such person who holds a post under Central Government or State Government and is governed by any other Act or by any rules providing for payment of gratuity" or a person who is an apprentice. In other words, if a person holds a post under Central Government or State Government and is governed by any other Act or any rules providing for payment of gratuity or who is an apprentice, such person shall not be covered by expression "employee" who is entitled for payment of gratuity under the provisions of Act.
17. It is not in dispute that Late Shahid Ali was employed as Electrician in work-charged establishment of Electrical and Mechanical Division of Public Works Department, Gorakhpur. Thus, he was skilled and/or semi-skilled technical employee in the said establishment, therefore, next question arises for consideration is that as to whether Late Shahid Ali while in service had held any post under State Government and was governed by any other Act or by any rules providing for payment of gratuity or not? Admittedly, Late Shahid Ali was work-charged employee under the State Government and it has been through out the case of petitioner that being work-charged employee, according to Para 667 to 669 of Vol-6 of U.P. Financial Handbook Late Shahid Ali was not entitled for any pension or leave salary or allowances except in certain circumstances enumerated in Para-669
18. At this juncture it is to pointed out that besides the provisions contained under U.P. Financial Hand Book, the pension and gratuity relating to government employees are also governed by provisions of Civil Service Regulations. The Civil Service Regulations Part-I Chapter-I relating to pension, in its application in Uttar Pradesh, defines expression "pension" under Article 41 of the Regulations, which means except when the term "pension" is used in contradistinction to gratuity, "pension" included gratuity and under Article 370 of the Regulations the period of service rendered by an employee in work-charged establishment is not counted for the purpose of qualifying service for grant of pension, therefore, in my opinion, there can be no scope for doubt to hold that the work-charged employees are not entitled for gratuity under said Regulations for simple reason that services rendered by a government employee in work-charged establishment are not counted for the purpose of computation of pension which includes gratuity also.
19. Thus, question remains to be answered is that as to whether Late Shahid Ali had held any post under the State Government or not? In this connection it is to be pointed out that Apex Court in case of General Manager, Uttaranchal Jal Sansthan Vs. Laxmi Devi and others, (2009) 2 SCC (Labour & Service) 304, has held that daily rated and work charged employees are not holding any civil post under the State. A Division Bench of this Court in State of U.P. and others Vs. Smt. Munni Devi, 2010(10) ADJ 321 while following said decision has also held that work-charged employees are not holding any post under the State. Accordingly, benefit of compassionate appointment under Dying in Harness Rules, 1974 can not be extended to the Dependants of such work-charged employees. While taking the aforesaid view, Division Bench of this court has also taken note of Full Bench decision of this court rendered in Pawan Kumar Yadav & others Vs. State of U.P. & others, 2010(8) ADJ 664(F.B.) wherein it has been held that work-charged employees are not holding any post under State as they are not appointed against any substantive or regular vacancy. The aforesaid decisions are binding upon me, therefore, in wake of aforesaid legal position, I am of the considered opinion, that Late Shahid Ali had not held any post under State of Uttar Pradesh while he was in service and was not governed by any other Act or by any other rules like Civil Services Regulations etc. providing for payment of gratuity, therefore, he could not be excluded from the expression "employee" defined in Section-2 (e) of the Act. Accordingly, in my view he was covered by the expression "employee" defined under the Act, who was entitled for payment of gratuity under the Act.
20. Now another question arises for consideration is that as to whether the government letter dated 28th April, 1986 whereby the benefits of payment of gratuity has been extended to work-charged employees of Irrigation Department of Government of U.P. excludes the applicability of Payment of Gratuity Act-1972 in respect of the work-charged employees of P.W.D. of Government of U.P. or not? In order to answer this question it would be useful to extract the aforesaid government letter as under:-
izs"kd] Jh ,u0 jke] la;qDr lfpo] mRrj izns'k 'kkluA lsok esa] izeq[k vfHk;Urk] flapkbZ foHkkx] m0iz0 y[kuÅA [email protected] vuqHkkx y[kuÅ fnukad 28 vizSy] 1986 fos"k; %% flapkbZ foHkkx ds dk;ZizHkkfjr vf/ks"Bku ds vUrxZr dk;Zjr deZpkfj;ksa dks isesUV vkWQ xzsP;qVh ,DV] 1972 ds vUrxZr xzsP;qVh dk Hkqxrku fd;k tkukA egksn;] flapkbZ foHkkx ds dk;ZizHkkfjr deZpkfj;ksa }kjk ;g ekax dh tkrh jgh gS fd mUgsa xzsP;qVh dk ykHk vuqeU; fd;k tk;A 'kklu }kjk lE;d ijh{k.kksijkUr bl ekWx dk vkSfpR; ik;k x;k vkSj rnuqlkj ;g fu.kZ; fy;k x;k gS fd flapkbZ foHkkx dh fofHkUu ifj;kstukvksa esa dk;Zjr lHkh dk;ZizHkkfjr deZpkjh] tks jkT; ljdkj ds vUrxZr fdlh in dks /kkfjr u djrs gks rFkk ftUgs fdlh vU; vf/kfu;e ;k fu;e ds vUrxZr xzsP;qVh ns; u gks] vkSj ftu ij isesUV vkWQ ostst ,DV ykxw gksrk gks] mUgsa xzsP;qVh vuqeU; dj nh tk;A 2& eq>s ;g dgus dk funsZ'k gqvk gS fd flapkbZ foHkkx ds dk;ZizHkkfjr deZpkfj;ksa dks rnuqlkj xzsP;qVh dk Hkqxrku fd;s tkus dh dk;Zokgh djus dk d"V djsaA ;g vkns'k fnukad 1 Qjojh] 1986 ds ckn lsokfuo`Ee gksus okys deZpkfj;ksa ij ykxw ekuk tk;sxkA 3& bl laca/k esa gksus okyk O;; flapkbZ foHkkx ds vk; O;;d ds mlh eq[;@[email protected] 'khs"kZd ds ukes Mkyk tk;sxk tgkW ls mlds osru vk; dk Hkqxrku fd;k tkrk gSA 4& ;g vkns'k foRr foHkkx dh v'kkldh; la0 ---------------------------------- 9 vizSy] 1986 esa izkIr lgefr ls tkjh fd;s tk jgs gSA Hkonh;
[email protected] 11-04-86 ¼,u jke½ la;qDr lfpo la[;k 354 ¼1½@86&23&fla&7] rn~fnukad izfrfyfi fuEufyf[kr dks lwpuk ,oa vko';d dk;Zokgh gsrq izsf"kr %& 1& egkys[kkdkj ¼f}rh;½] mRrj izns'k] bykgkcknA 2& Je vuqHkkx&[email protected] & U;k;¼fof/k ea=.kk½ vuqHkkxA 3& foRr ¼bZ&9½ [email protected] izfr;ksa esaA vkKk ls [email protected] 11-04-86 ¼,u jke½ la;qDr lfpo
21. A plain reading of the aforesaid Government letter it is clear that it has been issued by Joint Secretary, Government of Uttar Pradesh to the Engineer-in-Chief, Irrigation department of Government of Uttar Pradesh for providing the benefit of gratuity to the work-charged employees of said department under the provisions of Payment of Gratuity Act-1972. Thus, the aforesaid Government letter is confined to the work-charged employees working in various projects of Irrigation department alone but even assuming that such letter has been issued for work-charged employees of another department including P.W.D. department of Government also even then it cannot be said that such work-charged employees are excluded from the applicability of the provisions of Payment of Gratuity Act, 1972 for the reason that said letter itself insists for payment of gratuity to the work-charged employees under the said Act-1972 who do not hold any post under the State Government and are not entitled for payment of gratuity under any Act or rules and in respect of whom the Payment of Wages Act are applicable. Since the work-charged employees do not hold any post under the State, as indicated herein before and they are also not entitled for payment of gratuity either under any enactment or rules like Civi Service Regulation, therefore, in my opinion, in spite of aforesaid letter, Late Shahid Ali cannot be held to be excluded from the definition of expression "employee" as contemplated under Section-2(e) of the Act.
22. Before concluding the aforesaid issue another question remains to be answered is that as to whether the work-charged employees of P.W.D. of Government of U.P. are covered by the Payment of Wages Act or not? The Apex Court in State of Punjab Vs. The Labour Court, Jullundur and others, 1979 (39) FLR 353 while considering the project undertaken by the Hydel department of Government of Punjab has, held that it is an "industrial establishment" within the meaning of Payment of Wages Act. Section-2 (ii) (g) of which defines an "industrial establishment" to mean any "establishment in which any work relating to construction, development or maintenance of buildings, roads, bridges or canals, or relating to operations connected with navigation, irrigation or the supply of water, or relating to the generation, transmission and distribution of electricity or any other form of power is being carried on". Since work-charged establishment of Public Works Department is employed to carry out construction, maintenance and development of Roads, Buildings etc. therefore in my opinion, work-charged establishment is covered by the definition of "industrial establishment" as contained under the Payment of Wages Act and since Late Shahid Ali was employee of work-charged establishment, therefore, there can be no scope for doubt to hold that the Payment of Wages Act was applicable to him. Thus in view of law laid down by Hon'ble Apex Court, Late Shahid Ali was entitled to get benefit of payment of gratuity under the provisions of Payment of Gratuity Act, 1972 according to such government letter also, and aforesaid letter does not exclude the applicability of said Act to him.
23. Last question which arises for consideration is that as to whether in given facts and circumstances of the case respondent No. 1 is entitled for payment of gratuity under the Act on death of Late Shahid Ali or not? In order to answer this question it is to be noted that Section 4 of the Act provides for payment of gratuity to an employee or nominee or heirs of such employee on his death under circumstances referred thereunder. For ready reference relevant part of Section 4 of the Act is quoted as under:-
"4. Payment of gratuity.- (1) Gratuity shall be payment 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.} Explanation.- For the purposes of this section, disablement means such disablement as incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement.
(2) For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days' wages based on the rate of wages last drawn by the employee concerned :
Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account :
Provided further that in the case of {an employee who is employed in a seasonal establishment and who is not so employed throughout the year}, the employer shall pay the gratuity at the rate of seven days' wages for each season.
{Explanation.- In the case of a monthly rated employee, the fifteen days' wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen.} (3) The amount of gratuity payable to an employee shall not exceed one lakh rupees.
(4) ........
(5) ........
(6) ........
24. Thus aforesaid provisions, clearly stipulate that gratuity shall be paid to an employee on 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. but completion of continuous service of five years shall not be necessary where the termination of employment of any employee is due to death or disablement. In case of death of 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 nominee or heir is 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. Further sub- section 2 of the Section 4 provides method of computation of gratuity for every completed year of service or part thereof in excess of six months. Sub Section (3) provides that the amount of gratuity payable to an employee shall not exceed one lakh rupees. Thus from the aforesaid provisions of law it is clear that restriction of five years continuous service for payment of gratuity under the Act is not applicable to those employees who have died or have become disable due to accident or disease. Admittedly Late Shahid Ali, had rendered more than 11years continuous service in the work-charged establishment of the petitioner, therefore, there can be no scope for doubt to hold that, being heir of Late Shahid Ali, the respondent No. 1 is entitled for payment of gratuity under the Act.
25. In view of the aforesaid discussion I am of the considered opinion that view taken by the controlling authority while directing for payment of gratuity to the respondent No. 1, is fully justified, therefore, no interference is called for in the impugned order. Writ petition is without merit, therefore, is liable to be dismissed, accordingly same is hereby dismissed.
26. There shall be no order as to costs. Parties shall bear their own cost.