Writ petition 1940/2010 1 FARAD CONTINUATION SHEET No. IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE SIDE, BENCH AT AURANGABAD WRIT PETITION NO. 1940/2010 Bombay Mercantile Co-operative Bank 89, Mohamedali Road, 3rd floor, Mumbai-400 003 through its Regional Head, Shaikh Mushtaq Ali Ahmed, Age : 60 years, Occu. Service, Regional Head, Marathwada Region, Bombay Mercantile Co-op. Bank Ltd. Juna Bazar, City Chowk, Aurangabad. ...Petitioner. Versus 1 The State of Maharashtra, through its Secretary, Ministry of Labour Welfare, Mantralaya, Mumbai-32. 2 The Controlling Authority of the Payment of Gratuity Wages Act, 1972 and The Assistant Labour Commissioner, Aurangabad. 3 The appellant Authority under the Payment of Gratuity Act, 1972 and The Deputy Commissioner of Labour, Aurangabad. 4 Mohammed Hafizoddin Quadri, Age : 60 years, Occu. Retired, R/o 5-1, Ahbab Colony, Near Younus Colony, Katkat Gate, Aurangabad. ...Respondents. Mr. A.D. Kasliwal, for the petitioner. Shri S.B. Pulkundwar, A.G.P. for respondent Nos. 1 to 3. Mr. R.G. Shirsat with Mr. N.T. Tribhuwan, for respondent No.4 CORAM : A.V. NIRGUDE, J. DATED : 24th March, 2011. ORAL JUDGMENT : 1. As decided earlier, at admission stage, final submissions Writ petition 1940/2010 2 on this writ petition are heard today and the same is disposed of as under: 2 Rule. Rule made returnable forthwith. 3 The facts leading to this writ petition in short can be narrated as under. Respondent No.4 was in service of the petitioner Bank since 1971. In 1999 the petitioner Bank filed a charge sheet against the respondent No.4 and others for conducting departmental inquiry. The allegations against the respondent No.4 and others were that they manipulated and tampered with the record of the Bank and thereby caused loss to the Bank. While the inquiry was still pending, on 31/07/2003, respondent No.4 retired on reaching the age of superannuation. Few days before his retirement, petitioner Bank informed him that even though he was retiring on 31/07/2003, the departmental inquiry would continue and his retirement dues would be withheld pending the outcome of the departmental inquiry. Respondent No.4 did not take evasive action. 4 On 24/12/2004 the Bank completed the inquiry and recorded finding that the respondent Nos. 4 and others were guilty of tampering of the record of the Bank and had caused loss to the Bank to the tune of Rs.32,00,000/- but, thereafter admittedly the Bank did not initiate any action -criminal or civil- for recovery of the lost amount against respondent No.4 or others. But the Bank continued to withhold the amount of gratuity which was payable to the petitioner No.4 on the date he retired. The amount to which the respondent No.4 was entitled, was Rs.3,50,000/-. Despite of this, even the respondent No.4 did not take immediate steps for recovery of the the Writ petition 1940/2010 3 amount. Some time in 2005, he demanded the amount to the Bank and the Bank replied vide letter dated June 17, 2005 that since the Bank had suffered loss through the respondent No.4’s acts and omissions, he had lost his right to claim the amount of gratuity. Thereafter, respondent No.4 made several representations and requests to the Bank to pay the amount but, in vain. 5. Ultimately on 25/07/2007, respondent No.4 made application to the “controlling authority” appointed by the State Government under the Payment of Gratuity Act, 1972 at Aurangabad. The Bank opposed the application mainly on the ground that the above mentioned controlling authority was not competent to decide the dispute. It was their contention that the Bank is a Multi-State Bank having branches in more than one State and so the State appointed controlling authority would have no jurisdiction to decide the dispute. However, the controlling authority rejected this objection. The Controlling authority allowed the application and directed the Bank to pay Rs.3,50,000/- to the respondent No.4 along with simple interest @ 7%, within 30 days from the date of the order. The Bank challenged this judgment and order before the appellate authority. The appellate authority on merits held that respondent No.4 was entitled to the amount of gratuity ordered to be paid to him. But the it did not specifically decide as to whether the controlling authority and the appellate authority had jurisdiction to decide the dispute. 6 The objection in respect of jurisdiction is raised in view of provisions of Section 2 of the Payment of Gratuity Act, 1972. Section 2 reads as under. 2. Definitions: In this Act, unless the context otherwise requires - Writ petition 1940/2010 4 (a) ‘appropriate Government’ means - (i) in relation to an establishment- (a) belonging to, or under the control of, the Central Government, (b) having branches in more than one State, (c) of a factory belonging to, or under the control of, the Central Government, (d) of a major port, mine, oilfield or railway company, the Central Government, (ii) in any other case,the State Government; (b) “completed year of service” means continuous service for one year’ (c) “continuous service” means continuous service as defined in section 2-A. In relation to an establishment which has branches in more than one State, the appropriate authority is the Central Government. Admittedly, the petitioner Bank has branches in more than one State. It is thus clear that appropriate authority in relation to the petitioner Bank would be the Central Government. Reference can be made on this point to a judgment of this Court in case of Rhone Poulene (India) Ltd. Vs. Anjali Devrukhar & Others reported in 2005(4) Bombay C.R. 619. The ratio of this judgment is squarely applicable to the present case. There, the petitioner was a limited company having branches in more than one State. We have in this case a Bank which has branches in more than one State. Both the establishments are similar and therefore, law laid down in the above mentioned judgment would be applicable to this case also. Unfortunately, the learned authorities appointed by the State Government under the provisions of the Act did not realize this aspect and committed error in deciding the issue of jurisdiction. 7 In view of this, the finding recorded by them on merits are also vitiated and deserves to be set aside. The concurrent findings recorded through the impugned judgment should therefore be set aside. The Writ Petition to that extent deserves to succeed. Writ petition 1940/2010 5 However, I am not directing respondent No.4 to deposit back amount which he has received from the petitioner Bank during the pendency of the litigation. In view of Sections 4 and 7, it was incumbent upon Bank to make an application to the appropriate authority and raise dispute in respect of their liability to pay the gratuity amount and their claim for forfeiture of the same. They admittedly did not take necessary step before the appropriate authority which is according to them the appropriate authority appointed by Central Government. The rule is made absolute in following terms. ORDERS a) The impugned orders dated 25/11/2008 passed by the controlling officer in Application No. PGA/21/2007 and, dated 12/01/2010 passed by appellate authority and Ld. Labour Commissioner, Aurangabad in Appeal/PGA/02/2009 stand set aside. b) Original claim application filed by respondent No. 4 on 25/07/2007 shall stand transferred to the controlling authority appointed under Payment of Gratuity Act, 1972 by Central Government. c) Respondent No. 2 shall send the original claim application of the respondent No.4 dated 25/07/2007 to the controlling authority under the Payment of Gratuity Act, 1972 appointed by the Central Government within four weeks from today. Writ petition 1940/2010 6 d) The parties shall appear before the controlling authority. e) The controlling authority appointed by Central Government shall decide the case as soon as possible preferably within one year from the date of receipt of record and proceedings. [A.V. NIRGUDE,J.] ts k/2011/march24/wp1940.10/ok