NAGAR AYUKT, NAGAR NIGAM Vs. MUJIB ULLA KHAN

JUDGEMENT

(1.) HEARD Sri Y.S. Sachan learned Counsel for the petitioner. Learned Standing Counsel appears for respondents 2 and 3.

(2.) THE contesting respondents were employees of Nagar Nigam, Kanpur. They filed application under Rule 10(1) of the Payment of Gratuity Rules, 1975 for distribution and payment of balance amount of gratuity over and above the amount received by them from Nagar Nigam on their retirement in accordance with Retirement Benefits and General Provident Fund Regulation, 1962, Rule 4(1) of the Regulations made under Section 548(1) of the U.P. Municipal Corporation Act, 1959 amended on 11.1.1988 provide for death -cum -retirement gratuity on calculation by the number of years completed by the employees with the condition that the gratuity paid to the employees of the Corporation is not more than 16.5 months of the last wages drawn by him. Prior to the amendment of these rules the amount of the gratuity were calculated 15 days salary per month over 15 -1/2 months salary. -The Additional Labour Commissioner, U.P. Kanpur Region, Kanpur the Controlling Authority under the Payment of Gratuity Act, 1972, heard the parties and has found that the petitioners are entitled to the gratuity at the rates prescribed in the Payment of Gratuity Act, 1972, and accordingly calculated gratuity to be payable of 15 days salary of every completed year, without any ceiling of months or a part thereof, and the difference is directed to be paid by the Nagar Nigam, Kanpur.

(3.) IN Municipal Corporation of Delhi v. Dharam Prakash Sharma : 1999 (81) FLR 867 (SC) the Supreme Court considered the question as to whether the employees of the Municipal Corporation Delhi employed by the State Government for the purpose of excluding them to be covered by the Act and Rules made by the Stale Government under Section 2(e) of the Payment of Gratuity Act, 1972. the Supreme Court held as follows: The only provision which was pointed out is the definition of 'employee' in Section 2(e) which excludes the employees of the Central Government and State Governments receiving pension and gratuity under the Pension Rules but not an employees of the M.C.D. The M.C.D. employee, therefore, would be entitled to the payment of gratuity under the Payment of Gratuity Act, The mere fact that the gratuity is provided for under the Pension Rules will not disentitle him to get the payment of gratuity under the Payment of Gratuity Act. In view of the overriding provisions contained in Section 14 of the Payment of Gratuity Act, the provisions of gratuity under the Payment of Gratuity under Pension Rules will have no effect. Possibly for this reason Section 5 of the Payment of Gratuity Act has conferred authority on the appropriate Government to exempt any establishment from the operation of the provisions of the Act if in its opinion the employee of such establishment are in receipt of gratuity of pensioner benefits not less favourable than the benefits conferred under this Act. Admittedly M.C.D. has not taken any steps to invoke the power of the Central Government under Section 14 of the Payment of Gratuity Act;. In the aforesaid premises we are of the considered opinion that the employees(of the M.C.D. would be entitled to the payment of gratuity under the Payment of Gratuity Act notwithstanding the fact that the provisions of the Pension Rules have been made applicable to them for the purpose of determining the pension. Needless to mention that the employees can not claim gratuity available under Pension Rules.