Food Corporation of India vs Shyam Sunder Deepak and Others

Sunil Kumar Sinha, J.—The appellant, Food Corporation of India, has preferred this appeal against the order dated 28-10-2006 passed by the learned Single Judge in Writ Petition No. 416/2002 as the writ petition filed by the appellant against the order dated 21-12-2001 passed by the Appellate Authority under the Payment of Gratuity Act, 1972 (hereinafter referred to as the "Act") has been dismissed by the Writ Court.

The brief facts are that while working as an officiating copyist in the establishment of District and Sessions Judge, Bilaspur, respondent No. 1 applied for appointment to the post of Assistant Grade-Ill in the petitioner-Corporation. His application, duly recommended and forwarded by the District and Sessions Judge, Bilaspur, was forwarded by the District Manager of the appellant to the FCI, Bhopal on 18-1-1968. Thereafter, vide office order dated 7-2-1968, he was selected for appointment to the post of Assistant Grade-Ill and was directed to join the Office of District Manager, Bilaspur, within 3 days of the issuance of the said order. It was mentioned in the order that the formal appointment order will be issued by the Officer on Special Duty. Thereafter, a formal appointment order was issued to respondent No. 1 on 2-3-1968.

Admittedly, respondent No. 1 worked with the appellant from 8-2-1968 to 31-3-1998, i.e., till the date of his superannuation. Before joining of respondent No. 1 in the establishment of the appellant, the District and Sessions Judge, Bilaspur, issued an order dated 14-12-1967 terminating the service of respondent No. 1 with effect from 20-1-1968 A.N. saying that the same was no longer required. When the gratuity of respondent No. 1 was paid, the period of services rendered by him in the office of District and Sessions Judge was not taken into account by the appellant and respondent No. 1 was paid gratuity for the services rendered by him with the appellant from 8-2-1968 till 31-3-1998.

Being aggrieved by the said action of the appellant, the respondent No. 1 filed a case before the Controlling Authority under the Payment of Gratuity Act, 1972. The said authority dismissed the case of respondent No. 1 vide order dated 30-7-1999 holding that respondent No. 1 failed to establish that the Food Corporation of India was required to take into account the services rendered in the Government for the purpose of gratuity.

Respondent No. 1 filed an appeal against the said order before the Appellate Authority under the Payment of Gratuity Act, 1972 who allowed the appeal taking the aid of Clause 4 (3), Explanation 2 of the Food Corporation of India (Death-cum-Retirement Gratuity) Regulations, 1967 (hereinafter referred to as the ''Regulations, 1967'') and holding that according to the said clause, there was no break in service when the appellant left the service of District and Sessions Judge, Bilaspur and reported for service in FCI, therefore, he was entitled to receive the additional amount of gratuity in sum of Rs. 24,300/-. This order was challenged by the appellant before the Writ Court in W.P. No. 416/2002, in which the impugned order was passed and the writ petition was dismissed.

The Writ Court held that in the facts and circumstances of this case, the services of respondent No. 1 was continued and it was not a case of break in service, therefore, the finding and order dated 21-12-2001 passed by the Appellate Authority were just and proper.

Learned Senior Counsel for the appellant submitted that the District and Sessions Judge, Bilaspur, had terminated the services of respondent No. 1 on 14-12-1967 and thereafter he joined the services of the Corporation on 8-2-1968, therefore, it was a case of break in service and according to the Explanation 2 of Sub-clause (3) of Clause 4 of the Regulations, 1967, he would not be entitled to receive the gratuity for the services rendered with the earlier employer. He also argued that there was no declaration by the Managing Director to deem his earlier services, in whole or in part, to be the qualifying service in the Corporation; therefore, in no case, respondent No. 1 was entitled for gratuity of such period.

On the other hand, learned Counsel for respondent No. 1 supported the order passed by the learned Single Judge.

We have heard learned Counsel for the parties at length and have also perused the records of the writ petition.

Explanation 2 of Sub-clause (3)of Clause 4 of the Regulations, 1967 reads as follows:

Explanation 2:- Service rendered in the Govt. or any Public or Private undertaking by an employee before his joining service of the Corporation may be ''declared'' by the Managing Director to be deemed, in whole or in part, to be qualifying service in the Corporation provided that there was no break in service before joining the Corporation.

A perusal of the above provision would show that if an employee has earlier served in the Government or Private Undertaking, his services may be declared to be the "qualifying services" in the Corporation provided there was no "break in service" before joining the Corporation. Therefore, there was an obligation on the Managing Director either to declare or to refuse, in whole or in part, about the earlier services rendered by an employee but if the Managing Director fails to make such declaration, it cannot be said that the employee will lose his right to get gratuity for the services rendered by him with his earlier employer. The use of word "may" in this provision gives a primary presumption that this provision is not imperative. Even otherwise also such inference is strengthened from the benevolent nature of legislation, i.e., Payment of Gratuity Act, 1972, with reference to which, the regulations have been framed. If an authority does not fulfil its obligation in relation to the rights of an employee, it does not mean that a right created in favour of an employee under the law shall be defeated. In the present case, the Corporation could not show that a declaration under Explanation 2 was ever refused by the authority, therefore, in view of the aforesaid provisions of the Explanation, absence of such declaration in favour of respondent No. 1, in the facts and circumstances of the case, would make no difference if he was legally entitled to receive gratuity for his earlier services.

About the break in service, factual aspects of the case are to be looked into. Admittedly, respondent No. 1 applied for his selection in the Corporation while he was working with the Office of District and Sessions Judge, Bilaspur. His application was duly forwarded by the concerned District and Sessions Judge and after receiving the application by the District Manager of the Corporation, it was forwarded to its Bhopal''s office on 18-1-1968. Respondent No. 1 was selected vide order dated 7-2-1968 and was directed to join in the office of District Manager, Bilaspur, within 3 days where he joined on 8-2-1968. Before joining the services in the Corporation, by order dated 14-12-1967, the services of respondent No. 1 was terminated by the District and Sessions Judge with effect from 20-1-1968, that means, his application was forwarded to Bhopal in the period between 14-12-1967 and 20-1-1968 and the process of appointment in the Corporation was on. This all is clear from the memo dated 18-1-1968 written by the District Manager, Bilaspur, to the concerned authority of Food Corporation of India, Bhopal, as the said authority was the Competent Authority to issue an appointment order. After receiving this memo, a formal appointment order was issued on 7- 2-1968 and respondent No. 1 joined the Corporation on 8-2-1968. Therefore, it is clear that, in fact, to facilitate the joining of respondent No. 1 in the Corporation, a conditional termination order was issued by the District and Sessions Judge on 14-12-1967 which was w.e.f. 20-1-1968 giving a time of more than one month but some more time was consumed by the Corporation in issuing the formal appointment order to respondent No. 1 and in a gap of 17 days, respondent No. 1 joined the Corporation.

Moreover, when the Appellate Authority on due appreciation of evidence, adduced by the parties, determined that in the facts and circumstances of the case, there was no break in service when respondent No. 1 left the service of District and Sessions Judge, Bilaspur and reported for service in the Food Corporation of India, the learned Single Judge was wholly right in dismissing the petition challenging the findings recorded by the Appellate Authority under the Act and in not interfering with the order of the Appellate Authority. In such case, where the High Court was exercising power of judicial review, there are inherent limitations and it has not to sit as an Appellate Authority or the Second Appellate Authority and to re-appreciate the facts and evidence adduced before the Domestic Tribunals. The benefit has been extended by the Authority under the Act to the employee by recording a finding that there was no break in service and the employee was entitled to get the gratuity for the service rendered by him with his previous employer, that was not to be interfered by the High Court and the learned Single Judge has rightly not entered into such controversy and has rightly dismissed the writ petition. The Act has been enacted with a view to grant benefit to the employees. In interpreting the provisions of such beneficial legislation or the regulations relating thereto, therefore, a liberal view should be taken. The Authorities have held that respondent No. 1 was entitled to receive Rs. 24,300/-, as the additional amount of gratuity, which was not to be interfered by the Single Judge on the principles of inherent limitations while exercising the powers of judicial review and the learned Single Judge has rightly dismissed the writ petition.

We do not find any merit in this appeal. The appeal is liable to be dismissed and is accordingly dismissed. No orders as to costs.