Case: Union Of India  Vs. Manik Lal Banerjee

One Pritam Singh who is said to be similarly situated, however, claimed and obtained such benefits of gratuity in terms of the provisions contained in the Payment of Gratuity Act, 1972 (for short "the 1972 Act") in terms whereof the element of dearness allowance was calculated at the rate of 125% of basic salary. A special leave petition filed there against was dismissed by this Court by an order dated 13.2.2002is not a fit case for our interference under Article 136 of the Constitution. Hence the appeal isrelying on the said decision, the Respondent filed an original application before the Central Administrative Tribunal claiming payment of gratuity on the same terms and for recovery of purported arrears of the difference of gratuity. The Tribunal by an order dated 25.2.2004 directed the Appellant to consider the Respondents case whereupon a speaking order was passed by the Appellant on 4.6.2004 inter alia holding that the case of the Respondent was not governed by the provisions of the 1972 Act but by the provisions of the Railway Services (Pension) Rules, 1993 (for short "the 1993original application was filed by the Respondent questioning the validity of the said order before the Tribunal which was registered as OA No. 576 of 2004. The said application was allowed by an order dated 1.12.2004 holding interDe, the learned counsel for the respondents to a query replied that Pritam Singh case was complied with by the Railway Authorities. It is most unfortunate to state here that the DRM treated the matter in a different manner in order to avoid payment and has passed such illegal order by stating that dismissal of SLP by the Honble Supreme Court does not amount to a decision on merits. He has lost sight of the fact that the CAT does not hold the jurisdiction to sit in appeal against the order passed by the Controlling Authority under the Gratuity Act. In Pritam Singhs case an independent direction was passed by the CAT by invoking the provisions of Gratuity Act. Similar benefit ought to have been given to the present applicant. From the totality of the facts and circumstances of the case, I direct the respondent No. 2 to pay the Gratuity as claimed by the applicant in terms of Section 4 of the Indian Gratuity Act, 1972 together with the interest @12% per annum from the date when it became due till the date of payment and file compliance report within four months, failing which appropriate action, as deemed fit, will bewrit petition filed by the Appellant questioning the legality of the said Order was dismissed by a Division Bench of the High Court holding that the 1993 Rules do not make an employee of the Railways disentitled to the benefit of gratuity under the 1972 Act. It was furthermore held that there was no reason as to why the decision of the Tribunal in Pritam Singh would not be given effect to.

Court's reasoning:
We have noticed hereinbefore that in terms of the 1993 Rules the emoluments were to be paid in terms of the recommendations made by the Fourth Pay Commission. The Fifth Pay Commission no doubt recommended that dearness pay be linked to All India Consumer Price Index of 12.1.1966 as on 1.7.1993 but, the entitlements of the employees in terms thereof was directed to be prospectively affected with effect from 1.4.1995. The Central Government accepted the said recommendations only with prospective effect from 1.4.1995 in terms whereof 97% of the dearness allowance was to be paid to those who were drawing salary up to Rs. 3500/- as basic pay. The Respondent retired on 31.1.1995. The recommendations of the Fifth Pay Commission, thus, were not applicable in his case.