MUNICIPAL BOARD Vs. UNION OF INDIA UOI

JUDGEMENT

(1.) Both these petitions have been filed by Municipal Board, Pilkhuwa, district Ghaziabad, challenging the orders passed by the Controlling Authority on December 21, 1992, directing the Municipal Board to pay the amount of gratuity to the respondents Nos. 3 to 7.

(2.) Facts giving rise to this petition are that respondents Nos. 3 to 7 filed applications before the controlling authority for direction to the petitioners to pay the amount of gratuity on their retirement. Applications were filed by the employees and also in cases employee was dead by the heirs and legal representatives. The controlling authority after hearing the employees as well as petitioners, by the impugned order has directed that provisions of the Act are applicable to the Municipal Boards and the petitioners are liable to pay the gratuity. Consequently the impugned direction has been issued to pay the amount. Learned counsel for petitioners has submitted that petitioner Municipal Board, Pilkhuwa is not an establishment within the meaning of any State Law and as such it could not be governed by Section 1 (3) (b) of the Payment of Gratuity Act, 1972 (hereinafter referred to as 'the Act') and as it is not an establishment the Notification dated January 23, 1982 under Section 1(3) (c) of the Act could be of no consequence and the direction issued is wholly illegal and without authority. The submission of the learned counsel is that the Municipal Board is not an establishment and the controlling authority has committed illegality in applying provisions of the Act. In my opinion the contention of the learned counsel is devoid of any merit. The dictionary meaning of the word 'establ ishment' is 'the group of people in position of authority or influence'. It cannot be denied that the Municipal Board is constituted under the provisions of the Municipalities Act, 1916. Word 'Municipality' has been defined under Section 2(9) of the aforesaid Act which means any local area which is a Municipality by reason of a notification issued under Section 3 or, subject to the provisions of the said Section , any local area which was a municipality at the time immediately preceding the commencement of this Act. Section 6 of the Municipalities Act further provides that in every municipality there shall be a Municipal Board and every such Board shall be a body corporate by the name of the Municipal Board of the place by reference to which the municipality is known, having perpetual succession and a common seal, and, subject to any restriction or qualification imposed by this or any other enactment, of acquiring, holding and transferring property, movable or immovable, and of entering into contracts. The Municipalities Act, 1916 contains various provisions for constitution of the Board and defining power of the Board which leaves no doubt that it consists of a group of people established by the Statute with the authority or influence to manage the various affairs of the municipality of the area notified as municipality under Section 3 of the Act. In my opinion, Municipal Board, Pilkhuwa by virtue of the provisions contained in the Municipalities Act, 1916 itself, is an establishment and to term it establishment it is not necessary to search provisions in any other enactment. Learned counsel has tried to distinguish the Municipal Board with reference to the Uttar Pradesh Dookan and Vanijya Adhishthan Adhiniyam, 1962 (U.P. Act No. 26 of 1962) which deals with shops and commercial establishments. In my opinion, it is true that Municipal Board may not be a commercial establishment but it is an establishment under the provisions of the Municipalities Act, 1916 itself and the provision of the Act of 1972 could be applicable under Section 1(3) (b). Moreover, to remove any doubt in this regard, the Central Government in exercise of the power contemplated under Section 1 (3) (c) has published the Notification dated January 23, 1992, filed as Annexure 2 to the writ petition, that all the local bodies which will obviously include Municipal Boards, shall be governed by the Act if they employ 10 or more persons. It is an admitted fact that the strength of the employees of the petitioner is over 300. In this way even assuming that it could not be establishment under U.P. Act No. 26 of 1962, the petitioner is establishment under the Act under which it has been created and by virtue of the Notification under Section 1(3) (c), the provisions of the Payment of Wages Act, 1972 are applicable to the petitioner. The order of the controlling authority thus docs not suffer from any error of law or jurisdiction as there is no controversy about the factual aspect of the case. It may be mentioned that identical controversy was raised by petitioner in Writ Petition No. 9049 of 1985 which was decided on August 23, 1985 and the contention of the petitioner was not accepted by this Court. The aforesaid judgment is reported in 1985 A. W.C. 947.

(3.) Learned counsel for petitioner has placed reliance in case State of Punjab v. Labour Court, Jullundur and Ors. (1981-I-LLJ-354) (SC). From the aforesaid judgment it is clear that their Lordships repelled the contention and observed that there is no warrant for so limiting the meaning of the expression 'law' in Section 1(3) (b). The expression is comprehensive in its scope, and can mean a law in relation to as well as, separately, a law in relation to establishments, or a law in relation to shops and commercial establishments and a law in relation to commercial establishments. In my opinion, as the provisions of Section 1 (3)(b) are comprehensive, it may include even the provisions of the Act under which the Municipal Board has been constituted for ascertaining whether it is establishment or not. The aforesaid judgment does not help the petitioners in any manner.