IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN TUESDAY, THE 20TH SEPTEMBER 2011 / 29TH BHADRA 1933 WP(C).No. 24175 of 2011(V) -------------------------- PETITIONER(S): --------------- A.S.KURIAN, AGED 63 YEARS, S/O.SLEEBA, SENIOR SUPERINTENDENT (RETD.), KERALA STATE ELECTRICITY BOARD, RESIDING AT ANJANAMKUNNATH HOUSE, EZHAKKARANAD SOUTH P.O., ERNAKULAM DISTRICT. BY ADV. SRI.P.M.MOHAMMED SHIRAZ SMT.G.R.MANJU RESPONDENT(S): --------------- 1. KERALA STATE ELECTRICITY BOARD, REPRESENTED BY ITS SECRETARY, VYDYUTHI BHAVAN, PATTOM P.O., THIRUVANANTHAPURAM-695004. 2. CONTROLLING AUTHORITY UNDER PAYMENT OF GRATUITY ACT & DISTRICT LABOUR OFFICER, CIVIL STATION, KAKKANAD P.O.-682030. 3. APPELLATE AUTHORITY UNDER PAYMENT OF GRATUITY ACT & REGIONAL JOINT LABOUR COMMISSIONER, DEPARTMENT OF LABOUR, CIVIL STATION, KAKKANAD P.O.-682030. BY ADV.SRI.K.S.MANOJ, SC FOR R1 BY GOVT.PLEADER SRI.P.M.MANOJ FOR R2 & R3 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 20/09/2011, ALONG WITH WPC NO. 24233 OF 2011 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: SU WPC.NO.24175/2011 APPENDIX PETITIONER'S EXHIBITS: P1: COPY OF ORDER DATED 3-8-2010 IN G.C. NOS.392 TO 395 OF 2005. P2: COPY OF ORDER DATED 8-6-2011 IN G.A.NO.17 OF 2011. P3: COPY OF APPLICATION DATED 20-8-2011 OF PETITIONER. P4: COPY OF A/D CARD SIGNED BY 2ND RESPONDENT. RESPONDENTS' EXHIBITS: NIL. /TRUE COPY/ P.A. TO JUDGE SU P.N. RAVINDRAN, J. ------------------------------- W.P.(C) No. 24175 of 2011. ------------------------------- Dated this the 20th day of September, 2011 J U D G M E N T The petitioner is a former employee of the Kerala State Electricity Board (hereinafter referred to as 'the Board' for short). Upon retirement he was paid terminal benefit including gratuity computed in terms of the provisions contained in Part-III of the Kerala Service Rules. Long after retirement, relying on the decision of this Court in O.P. No.674 of 2002 the petitioner filed an application before the Controlling Authority under the Payment of Gratuity Act, 1972 (hereinafter referred to as 'the Act' for short) seeking payment of gratuity in terms of the said enactment. By Ext.P1 order passed on 3.8.2010, the Controlling Authority allowed the application and directed payment of the difference in the amount of gratuity with interest at applicable rates from the due date. Dissatisfied with the interest awarded by the Controlling Authority the petitioner filed appeal before the Appellate Authority. By Ext.P2 order passed on 8.6.2011 the said appeal was allowed and the Appellate Authority directed payment of interest at 10% per annum from 1.4.2003 till the date of payment. This writ petition is filed contending that though the said orders have attained finality, the amount directed to be paid WPC No.24175/2011 2 by the Controlling Authority/Appellate Authority has not so far been deposited. In this writ petition, the petitioner seeks an order directing the Board to deposit the amount payable under Exts.P1 and P2 orders and to permit him to withdraw the amount after it is deposited. 2. Sri.K.S.Anil, the learned standing counsel appearing for the Board submitted that the Board has by order No. B.O.(FB) No.1313/2011(PSI/Gratuity/TVPM/2006) dated 24.5.2011 decided to adopt and implement the provisions of the Act in respect of the employees of the Board and that the Board will therefore take steps to deposit the amount payable expeditiously. The learned standing counsel also submitted that having regard to the heavy financial commitment the Board may be granted at least three months' time from today to deposit the principal amount and six months' time from the date of deposit of the principal amount to deposit the interest portion and that the liability of the Board to pay interest may be limited till the date of deposit of the principal amount. The learned counsel appearing for the petitioner did not oppose the said request. That apart, I have by judgment delivered on 7.6.2011 in W.P.(C) No. 639 of 2011 and connected cases disposed of similar writ petitions filed by former employees of the Board wherein after taking note of the heavy financial commitment involved, I granted the Board three WPC No.24175/2011 3 months' time from the date of the judgment to deposit the principal amount and six months time thereafter to deposit the interest portion and had also directed that interest will run on the principal amount of gratuity directed to be paid by the Controlling Authority only from the due date till the date of deposit of the principal amount. I accordingly dispose of the writ petition with the following directions: (i) The Board shall within three months from today deposit before the Controlling Authority the principal amount payable to the petitioner in terms of Ext.P1 order. The Board shall within six months from the date of deposit of the principal amount, deposit the amount payable by way of interest from the respective due date till the date of deposit of the principal amount in terms of Exts.P1 and P2 orders. (ii) Upon such deposits being made, it will be open to the petitioner to unconditionally withdraw the amounts deposited. P.N. RAVINDRAN, JUDGE. vps WPC No.24175/2011 4 P.N. RAVINDRAN, J. ------------------------------- W.P.(C) No.24175 of 2011 ------------------------------- Dated this the 20th day of September, 2011 J U D G M E N T This writ petition have been filed by former employees of the Kerala State Electricity Board (hereinafter referred to as “the Board” for short) seeking a direction to the Board to pay or deposit the gratuity and interest thereon directed to be paid by the Controlling Authority. The Board resisted the applications contending that the petitioners are entitled to gratuity only in accordance with the provisions contained in Part III of the Kerala Service Rules (KSR for short) and not under the Payment of Gratuity Act, 1972. The contention of the petitioners was that in view of the decision of this Court in O.P.No.674 of 2002 which was affirmed by the Division Bench in W.A.No.1062 of 2003, they are entitled to gratuity under the WPC No.24175/2011 5 Payment of Gratuity Act, 1972 notwithstanding the provision for payment of Gratuity in the Kerala Service Rules. It is contended that the orders passed by the Controlling Authority have been upheld in appeal by the Appellate Authority and as the orders have become final, the Board is under an obligation to pay gratuity as directed by the Controlling Authority. 2. In majority of the cases, where the Board has deposited the principal amount of gratuity directed to be paid by the Controlling Authority, interim orders have been passed by this Court to release the principal amount of gratuity to the respective applicants on their executing personal bonds. In cases where the principal amount has not been deposited, directions have been issued to the Board to deposit the principal amount of gratuity and the applicants have been permitted to withdraw the same after executing personal bonds. Such conditional interim orders were passed having regard to the fact that the Board had filed a Special Leave Petition in the Honourable the Supreme Court of India canvassing the correctness of the decisions of this Court in O.P.No.674 of 2002 and W.A.No.1062 of 2003. In some of the cases, interest portion has also been deposited and the said amount is lying in deposit either before the Controlling Authority or before the Appellate Authority. WPC No.24175/2011 6 3. Sri.K.S.Anil, learned standing counsel appearing for the Board submitted that the Board has issued Order No.B.O.(FB) No.1313/2011(PS1/Gratuity/TVPM/2006) dated 24.5.2011 whereby the Board has decided to adopt and apply the provisions of the Payment of Gratutity Act, 1972 to the employees of the Board and to withdraw the Special Leave Petition filed by the Board in the Honourable Supreme Court of India from the decision of this Court. A copy of the said Board order was also made available to me. The learned standing counsel also submitted that the Board will have to incur an additional expenditure of approximately 250 Crores to pay gratuity under the Payment of Gratuity Act, 1972, and therefore, the Board may be granted three months time to deposit the principal amount of gratuity in cases where the principal amount of gratuity has not been deposited and six months time from the date of deposit of the principal amount to deposit the interest portion calculated from the respective due dates till the date of payment or deposit of the principal amount. The learned counsel appearing for the petitioners did not oppose the said request. In my opinion, in view of the huge financial commitment involved, the said request made on behalf of the Board for time to deposit the principal amount of gratuity and the interest portion deserves to be granted. WPC No.24175/2011 7 4. In the light of the stand now taken by the Board to withdraw the Special Leave Petition filed before the Honourable the Supreme Court of India and to adopt the Payment of Gratuity Act, 1972 in the matter of payment of gratuity to its former employees, I dispose of the writ petition with the following directions:- i) The Board shall wherever the principal amount of gratuity has not been deposited, deposit the principal amount of gratuity within three months from today before the Controlling Authority. Upon such deposit, it will be open to the respective applicants to withdraw the principal amount of gratuity unconditionally. ii) In cases where the Board has already deposited the principal amount of gratuity and the interest portion, the respective applicants will be free to withdraw the amounts unconditionally. iii) In cases where the applicants have withdrawn the principal amount of gratuity pursuant to the interim orders of this Court after executing personal bonds, such withdrawals will be treated as unconditional and the bonds executed by the respective applicants shall stand cancelled. iv) The Board shall deposit the interest portion which the petitioners are entitled to, at the applicable rates from the respective due dates, till the dates of deposit of the principal amount WPC No.24175/2011 8 of gratuity, within six months from the date of deposit of the principal amount. Wherever the principal amount of gratuity has already been deposited, the period of six months shall begin to run from this day. Needless to say, the petitioners will not be entitled to interest during the period from the date of deposit of the principal amount till the date of deposit of the interest portion. v) I also record the submission of the learned standing counsel for the Board that in view of the Board Order dated 24.5.2011, except in cases where the quantum of gratuity payable is in dispute, the appeals filed by the Board before the Appellate Authority from the orders passed by the Controlling Authority will be withdrawn. vi) If the petitioners have any grievance regarding the interest paid to them, it will be open to them to agitate the same in other appropriate proceedings. P.N. RAVINDRAN, JUDGE. vps