ition No 13009 of 1983
Under article 32 of the Constitution of India Gopal Subra aniam AC for the Petitioner Dr YS Chitale AV Rangam and Mrs Sarla Chandra for the Respondent
The Judgment of the Court was delivered by CHINNAPPA REDDY J
Smt
Katheeja Bai is the widow of Abdul Salam who retired as a Line Inspector Grade I in the employment of the Tamil Nadu State Electricity Board on 31776 and who unfortunately died on 151076
Katheeja Bai failed to get from her late husband s employers certain amounts which she claimed were due to her husband
She knocked continuously but in vain at the doors of the Regional Provident Commissioner Madras Central Provident Commissioner New Delhi and the Minister for Labour Government of India for several years for 800 redress
In sheer desperation she ultimately turned to this Court as a last resort
Unable to engage a lawyer she addressed a letter to a learned judge of the Court setting forth her grievance
After being processed in the Registry the letter was treated as a Writ Petition under Art 32 of the Constitution
A Rule Nisi was issued and the Tamil Nadu State Electricity Board have appeared before us through counsel
At our request Sri Gopala Subramanyam argued the case for the widow as amicus curiae
He presented the  case with understanding and thoroughness and we are grateful to him as also to Dr Chitaley who presented the employer s case with his usual fairness
In exercise of the powers conferred by s79c of the Electricity Supply Act 1948 the Tamil Nadu Electricity Board made the Tamil Nadu Electricity Board Contributory Provident Fund Regulations
Regulation 3 Provides for this establishment of a fund known as the Tamil Nadu Electricity Board Employees   Contributory Provident Fund with effect from 1757
Regulation 3 A to 3 K provide for the management and administration of the fund by the Board of Trustees
Regulation 4 prescribes that the Fund shall be governed by regulation a i may be in force for the time being but provides that no addition alteration or repeal of any regulation which may adversely effect a subscriber shall be retrospective
Regulation 5 provides that all employees who are eligible for the Contributory Provident Fund Tamil Nadu Scheme and Gratuity Scheme of the Government of Tamil Nadu except certain categories of employees with whom we are not concerned shall become subscribers to the fund on completion of three months continuous service
Regulation 6 prescribes that an account shall be opened in the name of each member in which shall be credited the member s subscriptions and interest thereon the contributions made by the Electricity Board to his account and interest thereon and the pre existing account before the Electricity Department was taken over by the Electricity Board
Regulation 9 provides for subscription to the fund by members at a the rate of 7 12 of pay plus dearness allowance
Regulation 11 provides for contribution by the Electricity Board to the account of each member at the rate of 7 of pay plus dearness allowance
The member s subscription along with the Electricity Board s Contribution is required to be credited to the individual account of the member before the 15th of every month
Regulation 37 prescribes that the Electricity Board shall credit to a member s Provident Fund account a special contribution calculated in the specified manner in addi 801 tion to the contribution credited under Regulation 11 if the Board is satisfied that the service of the member has been good efficient and faithful and the member has not been dismissed from service or the member has not been removed from service in which case the sanction of the Board has to be obtained
In the case of a Class I or Class II employee who quits service on attainment of the age of superannuation he is to be credited if his service exceeds 18 years with six months pay plus half a month s pay for each completed year of service after the 18th but not so is to exceed in all twelve months  pay or rupees twenty five thousand whichever is less
If the employee s service does not exceed 18 years he is to be credited with half a month s pay for each completed year of service so as not to exceed six months  pay
In the case of a Class III or Class IV employees who has attained the age of superannuation after 15 years  service the Electricity Board is required to credit his account with half a month S pay for each completed year of service but not so as to exceed to 15 months  pay
If the service is short of 15 years he is to be credited with half a month s pay for each completed year of service so as not is exceed six months  pay
It is provided in Regulation 37 that pay for the purpose of reckoning special contribution shall be the pay last drawn during the last three years of service whichever is more
The Board is also empowered to withhold or reduce the Special Contribution in any particular case
At this stage we may refer to section 12 of the which prohibits all employer from reducing directly or indirectly the total quantum of benefits in the nature of old age pension gratuity or Provident Fund or Life Insurance to which the employee is entitled under the terms of his employment express or implied by reason only of his liability for the payment of any contribution to the fund which is defined by section 2h as meaning a Provident Fund established under the employees  Provident Fund Scheme framed under section 5
In 1972 Parliament enacted the to provide for a scheme for the payment of gratuity to employees in certain establishments
There is no dispute that the Act applies to the Tamil Nadu State Electricity Board
Section 4 of the Act requires payment of gratuity to an employee who has rendered continuous service for not less than five years on the termination of his employment on superannuation or on retirement or on his 802 death or disablement due to accident or disease
The employer is required to pay the gratuity to the employee at the rate of fifteen days  wages for each completed year of service or part thereof in excess of six months
The amount of gratuity is not to exceed 20 months  wages
The employer is not required to pay any gratuity to an employee if the service of the employee has been terminated for any act wilful omission or negligence causing any damage or loss to or destruction of property belonging to the employer or if the services of the employee have been terminated for riotous or disorderly conduct or any other act of violence on his part or if his a services have been terminated for any act involving moral turpitude provided that such offence is committed by him in the course of his employment
Section 14 provides that the contribution of the Act shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than the 
Abdul Salam who held a non pensionable post retired on 31776 after a service of 34 years and live months
He died on 151076 within three months after his retirement
He was entitled or in this case his widow was entitled to the payment of the entire amount standing to his credit in his Provident Fund account and the gratuity payable under the 
The Electricity Board however took the stand that she was entitled to be paid the member s subscription and interest the employer s contribution and interest and gratuity but not the special contribution under Regulation 37 of the Tamil Nadu State Electricity Board Contributory Provident Fund Regulations
The reason for the Board s attitude was that the special contribution Required to be paid under Regulation 37 was nothing other than payment of gratuity and that they could not be asked to pay gratuity twice over once under the and again under Regulation 37
Since they were ready to pay the gratuity payable under the  which was more favourable to the employee they were not obliged to make payment of the contribution under Regulation 37
We may mention here that the Board has paid to the widow the member s subscription with interest and the employer s contribution with interest but not the special contribution under Regulation 37
The Board has paid a sum of Rs 4275 towards gratuity under the payment of Gratuity Act but a sum of 803 Rs 3167 is admittedly yet due from the Board towards gratuity
In the counter affidavit filed on behalf of the Electricity Board we are not able to find any reason for non payment of the balance of gratuity
We are unable to appreciate how the Electricity Board can avoid payment of the Special Contribution to Provident Fund under their own Provident Fund Regulations on the pretext that it is akin to or the same as Gratuity payable under the 
In the first place the Board in their Regulations have themselves labelled the Special Contribution under Regulation 37 as a Special Contribution to Provident Fund not as a Gratuity
It is not as if they were unaware of the word Gratuity  and what it meant since we find that there is a reference in Regulation 5 to a Gratuity Scheme of the Tamil Nadu Government which had been adopted by the Board
The Special Contribution under Regulation 37 is part of a well thought out Provident Fund Scheme designed to benefit good  efficient and faithful employees we borrow the words from the Regulation itself by ranking annual contributions in addition the monthly contributions under Regulation 11
This is what appears from Regulation or itself we see no justification for first dubbing it as a gratuity on the ground that it has some of the known characteristics af gratuity and then proceeding to deny the employees the benefit of it on the ground that the Board are paying gratuity under the 
If the Special Contribution has some common features with gratuity it has also distinctive features which distinguish it from gratuity payable under the payment of Gratuity Act For example one important feature which discriminates the Special Contribution under Regulation 37 from gratuity under the is that while the Payment of the latter is obligatory and can only be denied if the employee s services have been terminated for his riotous or disorderly conduct or any other act of violence on his part or any act which constitutes an offence involving moral turpitude and can also be denied to the extent of the damage or loss caused by the employee where the employee s services have been terminated for any act wilful omission or negligence causing any damage or to loss or destruction of property belonging to the employer the payment of the former is discretionary and may not be made if the service of the employee has not been good efficient and faithful
The employee has also the discretion to withhold or reduce the Special Contribution in any particular case
Of course 804 the employer cannot arbitrarily claim that the employee s service was not good efficient and faithful or with hold or reduce the Special Contribution in an arbitrary fashion
Even so the distinction between the mandate of the and the discretion involved in making the Special Contribution under Regulation 37 is intelligibly clear
Another feature which distinguishes the two is that the benefit of the is confined to persons drawing wages not exceeding Rs 1000 and does not extend to persons employed in a managerial or administrative capacity whereas the Special Contribution under Regulation 37 is not so confined and extends to every employee of the Board a except casual employees State or Central Government employees employed with the Board on foreign service terms etc
For the purpose of contribution of Provident Fund under Regulation 11 or Regulation 37 it makes no difference that a person is employed in a managerial or administrative capacity on that he draws wages more than Rs 1000 per month
A third feature which marks the two apart is that the contribution to the Provident Fund whether under Regulation 11 or Regulation 37 becomes part of the Fund established by Regulation 3 and is to be managed and administered by trustees under Regulation 3 A to 3 K whereas the payment of Gratuity Act does not provide for the Constitution of a fund to be managed and administered by trustees
In addition to these broad features we have the outstanding circumstance that the Board themselves have described the contribution under Regulation 37 as a contribution to Provident Fund and have chosen to include it in their Provident Fund Scheme
That should conclude the matter
Dr Chitaley invited our attention to section 14 of the which provides The provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in an enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act He argued that the provision for Special Contribution under Regulation 37 was inconsistent with the provisions of the and therefore the latter should prevail to the exclusion of the former
This argument is dependent on the assumption that the Special Contribution under Regulation 37 is the same thing as the gratuity contemplated by the Payment of 805 Gratuity Act
We have held that it is not and the argument therefore fails
There was then the usual lament that a large number of employees were involved and therefore the cost will be heavy
We do not understand this argument at all
Does it mean that beneficent legislations and beneficent schemes must be confined to small establishments employing a few workers only  On the other hand it is misleading to say that the cost is heavy
The cost is made to appear heavy divorced from the size of the establishment
If the establishment is huge and if a large number of workmen are employed the total wage bill may appear to be heavy but is it really so  Is it disproportionate to the size of the establishment its resources its revenues and its other expenditure  Is the individual wage bill also very high  To talk of heavy cost without reference to other circumstances is to present an entirely unfaithful picture
We heed make no further comment
In the result we direct the respondent Board to pay to the petitioner the whole of the Special Contribution under Regulation 37 which was payable to her husband and the balance of the Gratuity payable under the  part of which we are told has been paid leaving the sum of Rs 3167 unpaid
These amounts should be paid to the petitioner with interest at 15 per annum from the date on which the amounts fell due
The respondent Board should also pay a sum of Rs 2500 to the petitioner towards compensatory costs
We must add that the case had left us with the feeling of uneasiness and distress at the plight of helpless persons like the petitioner whose repeated representations to those in authority were left uncared for so the tediously long despite frequent protestations of social justice
HSK Petition allowed


Summary:
Regulation 37 of the Tamil Nadu Electricity Board Contributory Provident Fund Regulations framed by the Tamil Nadu Electricity Board under the Electricity Supply Act 1948 provides that the Electricity Board shall credit to a member s provident fund account a special contribution calculated in the specified manner in addition to the contribution credited under Regulation 11 if the Board is satisfied that the service of the member has been good efficient and faithful and the member has not been dismissed from service or the member has not been removed from service in which case the sanction of the Board had to be obtained
The which was also applicable to the Tamil Nadu Electricity Board provided for the payment of gratuity to employees who would retire after rendering service for a specified number of years
The petitioner s husband retired in 1976 after serving the Tamil Nadu Electricity Board for about 34 years and died three months thereafter
The petitioner was paid her husband s subscription to the Contributory Provident Fund and interest and the Electricity Board s contribution and interest and also the gratuity under the payment of Gratuity Act 1972
The Electricity Board did not pay the Special Contribution to be made by it to the contributory Provident Fund under Regulation 37 on the ground that the special contribution being nothing other than the payment of gratuity they could not be asked to pay gratuity twice over once under and again under Regulation 37
The petitioner having got no relief from anywhere wrote a letter to a Judge of the Supreme Court which was treated as a writ petition
Allowing the petition 799  HELD The Electricity Board cannot avoid payment of the special Contribution to Provident Fund under their own Provident Fund Regulations on the pretext that it is akin to or the same as Gratuity payable under the 
In the first place the Board in their Regulations have themselves labelled the Special Contribution under Regulation 37 as a Special contribution to Provident Fund and not as Gratuity
It is not as if they were unaware of the word Gratuity  and that it meant since it is found that there is a reference in Regulation 5 to a Gratuity Scheme of the Tamil Nadu Government which had been adopted by the Board
The Special Contribution under Regulation 37 is part of a well thought out Provident Fund Scheme designed to benefit good efficient and faithful  employees borrowing the words from the Regulation itself by making annual contributions in addition to the monthly contributions under Regulation 11
This is what appears from Regulation 37 itself
There is no justification for first dubbing it as a gratuity on the ground that it has some of the known characteristics of gratuity and then proceeding to deny the employees the befit of it on the ground that the Board are paying gratuity under the 
If the Special Contribution has some common features with gratuity it has also distinctive features which distinguish it from gratuity payable under the 
803B F In view of the finding that Special Contribution under Regulation 37 is not the same as gratuity under  the argument that the provision for Special Contribution under Regulation 37 was inconsistent with the provisions of the and therefore the latter should prevail to the exclusion of the former must fail
804H 805A