IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 23.06.2011 CORAM THE HONOURABLE MR.JUSTICE K.CHANDRU W.P.No.26031 of 2007 and M.P.No.1 of 2008 The Superintending Engineer Purchase and Administration Mettur Thermal power Station Mettur dam – 636 406. ... Petitioner Vs. 1.Appelalte Authority/ Joint Commissioner of Labour Coimabtore. 2.P.Perumal ... Respondents Petition filed under Article 226 of the Constitution of India, praying for the issuance of a Writ of Certiorari, calling for the records of the first respondent relation to his proceedings dated 19.06.2006 passed the Award in AGA No.225 of 2004 and quash the same. For Petitioner : Mr.B.Sekar For Respondent : Mr.R.Ravichandran, AGP for Mr.M.C.Swamy,. Spl. G.P. for R-1 Mr.V.Ajoy Khose – for R-2 O R D E R The petitioner is the Superintending Engineer, Purchase and Administration, Mettur Thermal Power station, Mettur Dam. He has come forward to file the writ petition, seeking to challenge an order passed by the first respondent Appellate Authority under the Payment of Gratuity Act, 1972 cum Joint Commissioner of Labour, Coimbatore made in A.G.A.No.225 of 2004 dated 19.06.2007 and seeks to set aside the same. https://hcservices.ecourts.gov.in/hcservices/ 2. The writ petition was admitted on 10.08.2007. Pending the writ petition, this court granted an interim stay. 3. It is seen from the records that the second respondent was employed as a Contract Labourer. He was absorbed under the service of the Board under the Regular Work Establishment as a Helper with effect from 01.05.1999 by the order of the Board dated 30.10.1999. He got retired from service on superannuation on 29.2.2000 and he had served the Board only for a period of two years. As per the Pension Rules applicable to the Board, (which is same as Tamil Nadu Pension Rules), under Rule 45A, unless a person puts in five years of qualifying service, he is not eligible for any gratuity. 4. Notwithstanding the same, the second respondent filed a gratuity application before the Controlling Authority under the gratuity Act viz., the Assistant Commissioner of Labour. The said gratuity application was taken on file as P.G. Case NO.83 of 2003. The case of the second respondent was that he has been working in the establishment since 1987 and he got retired only on 30.06.2001. Therefore, for the period of 14 years of service, he is eligible for gratuity. The authority held that for the period from 01.06.1987 to 30.04.1999, he had worked as a contract Labourer and thereafter, he had worked in the service of the Board. Therefore, his services were taken over as a regular worker for the remaining period and the Board being the principal employer is bound to pay gratuity even in respect of contract labourer. Though it was contended by the Electricity Board that they have got exemption under section 5 from the application of the Gratuity Act vide G.O.No.6998 Labour and Employment Department, dated 16.3.1985, but referring to paragraph 4 of the said Government order, the authority held that since the second respondent was not paid any pension and not covered by the pension Rules, he is eligible to get gratuity. It is in that view of the matter, the amount of Rs.36,690/- was directed to be paid. 5. As against the said order, the petitioner Board preferred an appeal before the Appellate Authority under section 7 (7) of the Payment of Gratuity Act, 1972. The said appeal was taken on file as A.G.A.No.225 of 2004 and notice was given to the second respondent workman. The second respondent workman filed a counter statement dated 17.01.2006. The Appellate Authority on the basis of the rival contention held that even if the second respondent was held to be a contract labourer, by virtue of section 21(4) of the Contract Labour Act, it is the principal employer who is bound to pay the gratuity even in respect of a Contract Labourer. https://hcservices.ecourts.gov.in/hcservices/ 6. As to whether a principal employer is bound to pay gratuity even in respect of Contract Labourer came to be considered by this court in Madras Fertilizers Ltd., v. Controlling Authority under Payment of Gratuity Act and others reported in 2003(1) L.L.N. 358. This court held that section 21(4) of the Contract Labour (Regulation and Abolition) Act, obliges an employer to pay wages payable to a contract labourer and fixes the liability on the principal employer and the term wages will also include gratuity. In paragraph 23, 24 and 26 it was held as follows:- "23.The contention of Sri A.L.Somayaji is clearly incorrect because for the purposes of wages since liability arises under S.21(4) of the contract Labour Act, we will have to go to the term "wages" as defined under the Contract Labour Act, i.e., S.2(h) which reads as under: "wages shall have the meaning assigned to it in cl.(Vi) of S.2 of the Payment of Wages Act, 1936 (4 of 1936). 24. It is, therefore, essential to go to the Payment of Wages Act to see as to what is the real import of the term "wages" as it is contemplated in S.21(4) of the Contract Labour Act. 26.... The plain meaning of the clause would be that where any sum is payable on termination of employment of the person under any law (in this case the payment of Gratuity Act), it would be covered under cl. (d) and, therefore, it excluded from the operation of Sub-cl. (6) and, therefore will amount to "wages". Once this construction is accepted, it is clear that it will be the basic responsibility, under S.21(4) of the Contract Labour Act, of the petitioner to make the payment of gratuity and the petitioner will have a right to recover that sum from the third respondent contractor because, according to me, the initial responsibility to make the payment of gratuity lies with the third respondent contractor." Therefore, the Authority has rightly rejected the appeal filed by the Board. 7. The second contention that the Board was exempted from the provisions of the Payment of Gratuity Act by virtue of Government notification is concerned, it must be noted that the said order itself in Paragraph 4 exempts the cases of the claims made by the persons like the petitioner. Therefore, there is no case made out to interfere with the impugned order. https://hcservices.ecourts.gov.in/hcservices/ 8. Hence, the writ petition stands dismissed. In view of the dismissal of the writ petition, the second respondent is entitled to withdraw the amount lying in deposit with the authority. If no such deposit is made, the petitioner Board is directed to pay the amount to the second respondent directly within a period of eight weeks from the date of receipt of a copy of this order. No costs Consequently, connected miscellaneous petition stands closed. svki Sd/- Asst. Registrar //True Copy// Sub Asst. Registrar To 1.The Appellate Authority/ Joint Commissioner of Labour Coimabtore. 2.The Superintending Engineer Purchase and Administration Mettur Thermal power Station Mettur dam – 636 406. + 1 cc to Mr. V. Ajoykhose, Advocate SR No.36146 + 1 cc to Government Pleader, SR No.36539 KJ(CO) SR/4.7.2011 ORDER IN W.P.NO.26031 of 2007 https://hcservices.ecourts.gov.in/hcservices/