1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY NAGPUR BENCH : NAGPUR WRIT PETITION NO. 461 OF 2010 (M.S.R.T.C. & Anr. vs. Regional Labour Commissioner and Appellate Authority & Ors.) Office Notes, Office Memoranda of Coram, appearances, Court's orders Court's or Judge's orders or directions and Registrar's orders. CORAM : B.P. DHARMADHIKARI, J. APRIL 23, 2010. Heard Shri Wankhede, learned counsel for the petitioner, Shri Adgokar, learned AGP for respondents No. 1 & 2 and Shri Saboo, learned counsel for respondent No. 3. The challenge is to the order of Controlling Authority under Section 7 and Appellate Authority under Section 7(7) of the Payment of Gratuity Act, allowing that application under Section 7 filed by Respondent No.3. He wanted the loan amount deducted from his gratuity payment to be released to him. The authorities have after considering the application and in the light of arguments advanced before it, decided the matter. It appears that only oral arguments were advanced. Before this Court in order to show the authority to deduct the amount, an agreement between Respondent No. 3 and his two guarantors and the State Cooperative Bank which has advanced loan to Respondent No. 3 is produced. That agreement shows that employee declared that if the loan is deducted from 2 his salary, allowance, bonus, gratuity etc. payable to him by M.S.R.T.C., he would have no objection to it and he is accordingly empowering his employer M.S.RT.C. to forward the amount so deducted towards his loan liability to State Cooperative Bank. Shri Saboo, learned counsel has pointed out that the petitioner is not party to this document. He also wants to rely upon certain judgments to show that deducting amount is not permissible under Payment of Gratuity Act. Shri Wankhede, learned counsel has placed reliance upon the judgment in the case of Punjab & Sind Bank vs. Regional Labour Commissioner & Ors, reported at 2008 II CLR 60, to show that in somewhat similar circumstances recovery by the employer from the gratuity amount has been upheld by the Division Bench of Punjab & Haryana High Court. The Bank which has extended loan to Respondent No. 3 is petitioner No. 2 before this Court. That Bank is a Cooperative Society. Hence, there has to be a tripartite agreement in accordance with law between the parties. Shri Wankhede, learned counsel has urged that petitioner No. 2 has authorized Petitioner No.1 to take such amount, however, that authorization is not on records. During arguments, Shri Saboo, learned counsel has informed that before this Court passed restraining orders on 03.02.2010, Respondent No.3 had already withdrawn the amount deposited, as per directions of the Controlling Authority. 3 Hence, it would be in the interest of justice to permit the petitioners to produce appropriate documents before Respondent No. 2 – Controlling Authority to show their authorization and also to point out relevant law on the subject as these issues are arising in several matters. This Court has already in earlier matter observed that employer is assisting the employees in defraying their loan liability through public exchequer. The employee is discharged of loan liability because of payment made by employer and then employer also pays back that amount to employee because of such order of gratuity authorities. Employer here has not even adduced any evidence before the Controlling Authority. If evidence or documents are produced, it is apparent that the petitioner as also Respondent No. 3 will get an opportunity to lead necessary evidence and after consideration of that evidence, Respondent No. 2 can apply the law and reach proper conclusion. If the Controlling Authority decides against Respondent No.3, Respondent No. 3 shall within two weeks of such adjudication, deposit the amount with the petitioner. With these directions, the impugned order dated 16.12.2008 passed by the Controlling Authority, Amravati and the judgment dated 05.11.2009 passed by the Appellate Authority are hereby quashed and set aside. The proceedings are restored back to the file of Respondent No. 2 for taking fresh decision in accordance with law after giving parties an opportunity to file documents and lead evidence. The parties shall appear 4 before Respondent No. 2 on 10th May 2010. Writ Petition is allowed. However, in the facts and circumstances of the case, there shall be no order as to costs. JUDGE *GS.