Canara Bank vs Rakesh Kumar Sharma & Ors.

KIRTI SINGH, J. (ORAL)

The petitioner-Bank has filed the present petition under Articles 226/227 of the Constitution of India seeking issuance of a writ in the nature of certiorari for quashing the order dated 26.06.2024 (Annexure P-1) passed by the learned Controlling Authority under the Payment of Gratuity Act, 1972 and Assistant Labour Commissioner (Central), Jalandhar, whereby the claim of respondent No.1 for differential gratuity was allowed, as also the appellate order dated 26.05.2026 (Annexure P-2) passed by the learned Appellate Authority under the Payment of Gratuity Act, 1972 and Deputy Chief Labour Commissioner (Central), Chandigarh, whereby the statutory appeal preferred by the petitioner-Bank against the said order was dismissed.

Briefly stated, as per the pleaded case respondent No.1 was engaged by the erstwhile Syndicate Bank, now amalgamated into the petitioner-Bank with effect from 01.04.2020, as a Deposit Collector/NND Agent with effect from 15.12.1988 and continued to render service in that capacity until 04.05.2020, thereby completing approximately 31 years and 4 months of engagement. It is not in dispute that respondent No.1 was not a regular employee of the Bank and was engaged purely as a Deposit Collector/commission agent under the Pigmy Deposit Collection Scheme. On cessation of his engagement, the petitioner-Bank paid him a sum of Rs.2,92,956/- towards gratuity, calculated at the rate of 15 days' average commission for each completed year of service, in terms of the Award dated 22.12.1988 passed by the Industrial Tribunal, Hyderabad in I.D. No.14/1980, as subsequently modified by the judgment dated 28.03.1997 of the Hon'ble High Court of Andhra Pradesh in Indian Banks Association v. Workmen of Syndicate Bank and others, and affirmed by the Hon'ble Supreme Court vide judgment dated 13.02.2001 in Civil Appeal No.3355 of 1998. Pursuant to the said Award and judgments, the Bank had issued Circular No.160/2005 dated 23.06.2005 prescribing that gratuity payable to NND/Deposit Collectors would be calculated at the rate of 15 days' average commission, computed on the average commission earned during the twelve months preceding cessation of agency, for each completed year of service. Applying this formula, the average commission earned by respondent No.1 during the twelve months preceding cessation was taken as Rs.18,900.45/-, and the resultant gratuity of Rs.2,92,956/- was paid to him. Respondent No.1, being of the view that the gratuity so paid was short of his entitlement under the Payment of Gratuity Act, 1972, filed a claim application before the Controlling Authority on 25.10.2021 seeking an additional amount of Rs.90,990/- along with interest. The Controlling Authority, vide order dated 26.06.2024, held that respondent No.1 was entitled to gratuity under the Payment of Gratuity Act, 1972, and computed the same by taking the average commission of Rs.18,900.45/- as the last drawn wages, arriving at a figure of Rs.3,38,027/. After adjusting the sum of Rs.2,92,956/- already paid by the Bank, a balance of Rs.45,071/- was directed to be paid, together with simple interest @10% per annum with effect from 05.05.2020 till payment. The petitioner-Bank preferred a statutory appeal under Section 7(7) of the Act, which came to be dismissed by the Appellate Authority vide order dated 26.05.2026, thereby upholding the order of the Controlling Authority in its entirety and directing release of the deposited amount to respondent No.1.

Learned counsel for the petitioner inter alia contends, that respondent No.1, being a Deposit Collector/NND Agent working purely on a commission basis, could never be equated with a regular employee of the Bank, and that the entitlement of such Deposit Collectors to gratuity was exhaustively and finally settled by the Award of the Industrial Tribunal, Hyderabad, as affirmed by the Hon'ble Supreme Court in Indian Banks Association v. Workmen of Syndicate Bank and others (2001), which itself held that Deposit Collectors could not be equated with regular employees for purposes of pay scales, allowances or other service conditions. It is submitted that the Payment of Gratuity Act, 1972 was consequently not applicable to the case of respondent No.1 at all, and the Controlling Authority erred in invoking it.

Learned counsel contends, in the alternative, that even assuming the Payment of Gratuity Act to be applicable, the Controlling Authority erred in treating the average commission of the twelve months preceding cessation, i.e. Rs.18,900.45/-, as the "last drawn wages" for the purpose of computation. It is submitted that, properly construed, the last drawn wages ought to have been the commission actually earned in the final month of service, namely Rs.14,312/, which, if applied, would yield a gratuity of only Rs.2,55,964/ ie. a sum lower than what has already been paid by the Bank thereby disentitling respondent No.1 to any further amount whatsoever.

I have heard learned counsel for the petitioner and perused the record with his able assistance.

At the outset, it deserves notice that the very judgment of the Hon'ble Supreme Court on which the petitioner-Bank places its principal reliance does not support the proposition that Deposit Collectors/NND Agents are disentitled to gratuity altogether. The Hon'ble Supreme Court in Indian Banks Association v. Workmen of Syndicate Bank and others, while declining to treat Deposit Collectors as regular employees entitled to absorption, pay scales and allowances on par with regular staff, expressly recognised them as "workmen" within the meaning of the Industrial Disputes Act and upheld their entitlement to gratuity and other retiral benefits as part of the package awarded by the Industrial Tribunal. The judgment cannot, therefore, be misconstrued to mean that Deposit Collectors are wholly outside the pale of gratuity; at best, it supports the petitioner's case that such Deposit Collectors are not to be treated as regular employees for other service benefits a distinction the impugned orders have not disturbed.

Equally, the petitioner-Bank's own conduct undermines its submission that the twelve-month average commission is an impermissible basis for computing last drawn wages. It is not disputed that the Bank's own Circular No.160/2005 dated 23.06.2005, issued in pursuance of the very Award and judgments relied upon by the petitioner, itself prescribes computation of gratuity for NND Agents on the basis of the average commission earned during the twelve months preceding cessation of agency. It was on this very basis an admitted average of Rs.18,900.45/- for the preceding twelve months that the petitioner-Bank computed and paid the initial sum of Rs.2,92,956/- to respondent No.1. Having itself adopted the twelve-month average as the measure of last drawn wages for the purpose of its own calculation, it is not open to the petitioner-Bank to now contend that the very same average is an incorrect or impermissible basis when applied by the Controlling Authority for computing the differential amount. The Appellate Authority has, in the impugned order, specifically taken note of this admission by the Bank, and no infirmity can be found in its acceptance of the said figure.

The contention that only the commission earned in the last month of service, namely Rs.14,312/-, ought to have been reckoned as last drawn wages does not commend itself to this Court, for the same reason. Both the Controlling Authority and the Appellate Authority have concurrently found, on facts, that the Bank's own scheme for NND Agents contemplates the average of twelve months' commission, precisely because remuneration under such a commission-linked engagement fluctuates from month to month and a single month's figure would not fairly reflect the agent's earning pattern. This is a finding of fact arrived at after due consideration of the material on record and the Bank's own circular, and no perversity or error apparent has been shown to warrant interference with it in exercise of writ jurisdiction.

It is well settled that the scope of interference under Articles 226/227 against concurrent findings of fact rendered by statutory authorities is a limited one, confined to cases of patent illegality, perversity, jurisdictional error or breach of natural justice. Mere disagreement with the appreciation of facts, or a request for re-appreciation of material already considered by the competent authorities, does not furnish a ground for interference.

In the present case, both the Controlling Authority and the Appellate Authority have applied their minds to the nature of respondent No.1's engagement, the Award and pronouncements governing Deposit Collectors, the Bank's own circular prescribing the method of computation, and the admitted twelve-month average commission, before arriving at a common conclusion. The petitioner-Bank has not been able to point out any patent illegality, perversity or jurisdictional infirmity in the concurrent view so taken.

It also deserves to be noticed that the entire controversy, in monetary terms, is confined to a differential of Rs.45,071/-, over and above the sum of Rs.2,92,956/- already paid by the Bank for more than 31 years of engagement- a modest differential which the statutory authorities have found payable together with interest, after due adjustment of the amount already disbursed.

For the foregoing reasons, no case for exercise of the extraordinary writ jurisdiction of this Court is made out. The present writ petition is accordingly dismissed.

Civil miscellaneous application pending, if any, shall also stand disposed of.