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Judgment
K. Chandru, J.—The Petitioner is the Management of Madurai East Sarvodaya Sangam. They have filed the present writ petition seeking to
challenge the order passed by the third Respondent Appellate Authority under the payment of Subsistence Allowance Act, 1981 in
P.S.A.A.6/2008 dated 30.11.2009 confirming the orders passed by the second Respondent controlling authority dated 11.06.2008 made in
P.S.A. No. 3/2007.
The first Respondent was employed as an Assistant in the Petitioner Sangam. She was placed under suspension with effect from 08.04.2004.
Therefore, she claimed subsistence allowance for the period from 08.04.2004 to 03.09.2005. For the first period, she claimed subsistence
allowance at the rate of 50%, for the second period i.e. 90 days to 180 days, she claimed at the rate of 75% and thereafter, for the further period
at the rate of 100% in terms of Section 3 of the Tamil Nadu Payment of Subsistence Allowance Act, 1981 (for short PS Act)
The second Respondent, being the controlling Authority entertained her claim as P.S.A. No. 3/2007 and issued notice to the Petitioner. The
Petitioner filed a counter statement dated Nil (May 2007). The stand of the Petitioner was that the first Respondent was dismissed from service
with effect from 08.04.2004 for various acts of misconducts and therefore until and unless the said dismissal order is set aside by a competent
court, she cannot claim any subsistence allowance. Without prejudice to the said stand, it was submitted that subsistence allowance was paid as
per the provisions of the P.S. Act. The said payment will also attract the provisions of Employees Provident Fund. The Petitioner has deducted
amounts towards subscription in the Provident Fund and had paid the contribution to the PF department. The deductions made in the subsistence
allowance is legal and valid and no amount is due and payable to the first Respondent. They had also filed a calculation sheet in relating to the
payment of subsistence allowance paid to the Petitioner, deductions made so far and the balance payment of subsistence allowance to be paid and
further deductions to be made in the balance amount. The amount worked out to Rs. 62,911/-for the period from 08.04.2004 to 03.09.2005. She
was already paid Rs. 29,171/-. After making deductions towards Welfare Fund loan, Bank Loan, Family welfare fund loan, Security as well as PF
and also the loss towards stock shortage, the balance amount worked out to Rs. 10,100/-. Even from that Rs. 10,100/-, P F amount, welfare fund
loan amount and bank loan and further amounts are to be deducted, finally the balance to be paid was Rs. 7,608/-.
Before the authority, the first Respondent examined herself as P.W.1. On the side of the Petitioner, one R. Nagarajan was examined as R.W.1.
On the side of the first Respondent, she marked her suspension order as Ex.P1 and on the side of the Management, 3 documents were filed and
marked as Exs. R1 to R3.
The authority found that no deductions are permissible in the subsistence allowance and after giving credit to the earlier amount of Rs.
29171.50, they will have to pay the balance of Rs. 34,308/-. Challenging the same, they filed an appeal under Rule 5A of the Tamilnadu Payment
of Subsistence Allowance Rules. As a condition precedent, they have deposited the entire amount before the third Respondent. The said appeal
was taken on file as P.S.A.A. No. 6/2008 and notice was given to the first Respondent.
The first Respondent filed a counter statement dated 7.7.2009. The third Respondent by a final order dated 30.11.2009 rejected the case of the
Petitioner and it held that no deduction is permissible from the subsistence allowance. The authority also held that the Act requires payment of
100% of the wages beyond 180 days of suspension and if the entire amount is paid as wages, then certainly PF amount can be deducted for that
portion. Under Rule 3(ii) of the PS Rules, no deduction is permissible from the subsistence allowance payable to an employee.
Mr. P. Chandra Bose, learned Counsel for the Petitioner relied upon the judgment of the Supreme Court in Regional Director, Employees''
State Insurance Corporation Vs. M/s. Popular Automobiles, . The Supreme Court in that judgment has held that during the suspension period, the
employee/employer relationship exists. He is prevented from only discharging his work and therefore, subsistence allowance is very much part of
the term ''Wages'' as defined u/s 2(22) of the ESI Act and employer is bound to make contribution u/s 39 of the PF Act.
In the present case, Rule 3(ii) clearly prevents any deduction. Therefore, the third Respondent has maintained the balance while following the
judgment of the Supreme Court in the case of Popular Automobiles(cited supra) and he also gave full meaning to Rule 3(ii). Therefore, his finding
that beyond 180 days when an employer is bound to pay full wages, then Rule 3(ii)will not have any operation and PF Contribution can be
deducted from the so called subsistence allowance. It is necessary to refer to Rule 3(ii):-
The subsistence allowance payable under this Act shall be paid in full subject to restrictions under the Act and it shall not be liable for any
deduction.
This Court is not inclined to accept the contentions raised by the Petitioner. Even if the Petitioner''s contention is accepted that it could only
related to PF account and not for other payments to be made by him, in the absence of any enabling provision and the amount to be deducted
towards PF is a very negligible amount, and considering the fact that the first Respondent was under suspension for more than a year, this Court is
not inclined to interfere with the order passed by the authorities.
Hence, this writ petition stands dismissed. In view of the dismissal of the writ petition, there is no impediment for the first Respondent to
withdraw the amount lying in deposit with the second Respondent. No costs. Consequently, connected miscellaneous petition is closed.