Allahabad Bank & Anr. vs All India Allahabad Bank Retired Emps. Assn.

3

2. A short question that arises for our consideration in

this appeal is as to whether the retired employees of

appellant bank are entitled to payment of gratuity under

the provisions of the said Act?

3. The retired employees of the appellant bank having

formed an association which includes officers and

subordinate staff sent a legal notice to the appellant bank

on 27.11.1988 requiring it to release the amount of

gratuity to its members in accordance with the provisions

of the said Act. The case set up by the Association was

that its members were being illegally deprived of their

statutory right to receive gratuity under the provisions of

the Act on the pretext that they had opted for pensionary

benefits in lieu of gratuity. It appears that on behalf of

the Association applications were sent to the competent

authority in the prescribed proforma for payment of

gratuity in response to which the appellant bank made its

stand explicitly clear that it was not possible to make

payment of gratuity in addition to pension. Since the

whole cause of action is based on the response of the 4

appellant bank dated 10.01.1989, it would be appropriate

to notice the same in its entirety.

"Ref. No. Admn./5/0280

Date: January 10,1989

The General Secretary All India Allahabad Bank Retired Employees Association, Central Office, Ram Bhawan, C-1254B, Sector-A, Mahanagar, Lucknow.

Dear Sir, Payment of Gratuity This has reference to your letter Bank/14/8 dated 14.11.1988 and enclosures.

In this connection, we have to

advise that Allahabad Bank has accepted contributory Provident Fund Scheme, which is not available to Government employees. Besides this, the Bank has a Pension Scheme in which an employee/officer may exercise option letter for Pension or Gratuity; but the dual benefits are not available under the scheme Since the respective pensioners have exercised their option voluntarily for availing of pension in lieu of Gratuity on their retirement from the bank's service, they are not eligible for gratuity at all. They are receiving pension since their retirement and as such we are not in a position to accede to your request for payment of gratuity in addition to pension to the persons named in your letter under reference.

5 Yours faithfully, Sd/-

(R.K. Nath) Chief Manager (P.A.)"

4. The Association thereafter filed a writ petition

asserting its right that its members were entitled to

receive gratuity in accordance with the provisions of the

Act. The contention was that the consent or option given

by the members of the Association opting for pension

scheme would not deprive them of their statutory right to

receive gratuity under the provisions of the Act. The

appellant bank resisted the writ petition filed by the

Association mainly relying upon the Awards known as

Shastry Award and Deasai Award and subsequent

settlements under which employees were entitled either

to the benefit of pension or benefit of gratuity at one's

own option but not both. The Bank took a specific stand

that the members of the Association had voluntarily opted

for pension scheme, as a result thereof, they were not

entitled to receive gratuity as well since they have already

exercised their option claiming benefit of pension. The 6

submission was that at the time of their retirement all the

employees were paid contributory provident fund and

pension in terms of option exercised by them, under the

relevant Pension Scheme of the bank and therefore, they

were not entitled to payment of any gratuity. The bank

further asserted that the employees opted for the

pensionary benefits which, admittedly, are better in

terms as found by various Awards that pensionary

scheme was really more advantageous to the employees

than that of the gratuity.

5. We may at this stage notice that appellant bank did

not succeed in its attempt to get the bank exempted from

the operations of provisions of the Act.

6. Before adverting to the question as to whether the

retired employees of the bank are entitled to payment of

any gratuity, it may be just and necessary to notice the

objects and reasons and the scheme of the Act. It was

realised that there was no Central Act to regulate the

payment of gratuity to industrial workers, except the

Working Journalists (Conditions of Service) and 7

Miscellaneous Provisions Act, 1955. The Government of

Kerala enacted legislation for payment of gratuity to

workers employed in factories, plantations, shops and

establishments. The West Bengal enacted an Ordinance

on 3.6.1971 prescribing a similar scheme of gratuity.

Gratuity was also being paid by some employers to their

workers under Awards and agreements. Since the

enactment of the Kerala and the West Bengal Acts, some

other State Governments have also voiced their intention

of enacting similar measures in their respective States. It

is under those circumstances the Union Government

realised that it has become necessary, to have a Central

law on the subject so as to ensure a uniform pattern of

payment of gratuity to the employees through out the

country. The Act was intended to avoid different

treatment to the employees of establishments having

branches in more than one State. The proposal for Central

legislation on gratuity was discussed in various Labour

Ministers' Conference, where Central legislation on

payment of gratuity was felt a necessity.

8

7. Section 4 (1) of the Act provides:

"(1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years,--

(a) on his superannuation, or

(b) on his retirement or resignation, or

(c) on his death or disablement due to accident or disease:"

8. The expression "employee" is defined in Section 2 (e)

of the Act as any person (other than apprentice)

employed on wages, in any establishment, factory, mine,

oilfield, plantation, port, railway company or shop to do

any skilled, semi-skilled, or unskilled, manual,

supervisory, technical or clerical work, whether the terms

of such employment are express or implied......... . There is

no dispute before us that the appellant bank is an

establishment and an employer within the meaning of the

provisions of the Act. Section 5 confers power upon the

appropriate Government to exempt any establishment,

factory, mine, oilfield, plantation etc. from the operation

of the provisions of the Act, if, in its opinion, the 9

employees in such establishment, factory etc. are in

receipt of gratuity or pensionary benefits not less

favourable than the benefits conferred under the Act.

The power to exempt conferred upon the appropriate

Government is not an unconditional power. The

appropriate Government is required to hear all the

persons concerned who are likely to be affected by the

decision to be taken and the exemption itself is subject to

the conditions mentioned in the provisions of the Act

namely that employee or class of employees in the

opinion of the government are in receipt of gratuity or

pensionary benefits not less favourable than the benefits

conferred under the Act.

9. A plain reading of the provisions referred to herein

above makes it abundantly clear that there is no escape

from payment of gratuity under the provisions of the Act

unless the establishment is granted exemption from the

operation of the provisions of the Act by the appropriate

Government.

10

10. Notwithstanding the subsequent improvements and

embellishments the stand taken by the bank was and is

before us that the members of the Association had

accepted the Contributory Provident Fund Scheme and

they opted for pension in lieu of gratuity which was being

paid and therefore are not entitled to payment of gratuity

under the provisions of the Act.

11. We shall proceed to examine the point urged by the

learned counsel for the appellant. Remedial statutes, in

contra distinction to penal statutes, are known as welfare,

beneficient or social justice oriented legislations. Such

welfare statutes always receive a liberal construction.

They are required to be so construed so as to secure the

relief contemplated by the statute. It is well settled and

needs no restatement at our hands that labour and

welfare legislation have to be broadly and liberally

construed having due regard to the Directive Principles of

State Policy. The Act with which we are concerned for the

present is undoubtedly one such welfare oriented

legislation meant to confer certain benefits upon the 11

employees working in various establishments in the

country.

12. Krishna Iyer, J in Som Prakash Rekhi Vs. Union of

India1 stated the principle in his inimitable style that

benignant provision must receive a benignant construction

and, even if two interpretations are permissible, that

which furthers the beneficial object should be preferred. It

has been further observed: "We live in a welfare State, in

a "socialist" republic, under a Constitution with profound

concern for the weaker classes including workers (Part

IV). Welfare benefits such as pensions, payment of

provident fund and gratuity are in fulfilment of the

Directive Principles. The payment of gratuity or provident

fund should not occasion any deduction from the pension

as a "set-off". Otherwise, the solemn statutory provisions

ensuring provident fund and gratuity become illusory.

Pensions are paid out of regard for past meritorious

services. The root of gratuity and the foundation of

provident fund are different. Each one is a salutary

benefaction statutorily guaranteed independently of the 1 (1981) 1 SCC449 12

other. Even assuming that by private treaty parties had

otherwise agreed to deductions before the coming into

force of these beneficial enactments they cannot now be

deprivatory. It is precisely to guard against such mischief

that the non obstante and overriding provisions are

engrafted on these statutes."

13. Interpreting the provisions of the said Act this Court

in Sudhir Chandra Sarkar Vs. Tata Iron and Steel Co.

Ltd.2 observed that pension and gratuity coupled with

contributory provident fund are well recognised retiral

benefits governed by various statutes. These statutes are

legislative responses to the developing notions of the fair

and humane conditions of work, being the promise of Part

IV of the Constitution. It was observed: "the fundamental

principle underlying gratuity is that it is a retirement

benefit for long service as a provision for old age.

Demands of social security and social justice made it

necessary to provide for payment of gratuity. On the

enactment of Payment of Gratuity Act, 1972 a statutory

liability was cast on the employer to pay gratuity." 2 (1984) 3 SCC 369 13

14. Gratuity payable to an employee on the termination

of his employment after rendering continuous service for

not less than 5 years and on superannuation or retirement

or resignation etc. being a statutory right cannot be taken

away except in accordance with the provisions of the Act

whereunder an exemption from such payment may be

granted only by the appropriate Government under

Section 5 of the Act which itself is a conditional power. No

exemption could be granted by any Government unless it

is established that the employees are in receipt of gratuity

or pension benefits which are more favourable than the

benefits conferred under the Act.

15. In Union of India Vs All India Services

Pensioners' Association And Another3, this Court

explained that there is always a distinction between the

pension payable on retirement and the gratuity payable

on retirement. "While pension is payable periodically as

long as the pensioner is alive, gratuity is ordinarily paid

only once on retirement." No decision of this Court which

3 (1988)2 SCC 580 14

has taken a view contrary to the decisions referred to

herein above has been brought to our notice.

16. In our considered opinion pensionary benefits or the

retirement benefits as the case may be whether governed

by a Scheme or Rules may be a package consisting of

payment of pension and as well as gratuity. Pensionary

benefits may include payment of pension as well as

gratuity. One does not exclude the other. Only in cases

where the gratuity component in such pension schemes is

in better terms in comparison to that of what an employee

may get under the Payment of Gratuity Act the

government may grant an exemption and relieve the

employer from the statutory obligation of payment of

gratuity.

17. In the result, we find merit in the submissions made

by the learned senior counsel, Shri P.P. Rao appearing for

the Association that pension and gratuity are separate

retiral benefits and right to gratuity is a statutory right.

However, Shri Dhruv Mehta, learned counsel for the bank

placed strong reliance on the decision rendered by this 15

Court in DTC Retired Employees' Association & Ors.

Vs Delhi Transport Corporation & Ors.,4 in support of

his contention that the employees of the bank are not

entitled to the twin benefits of payment of pension and as

well as gratuity. In that case, Delhi Transport Corporation

introduced the Pension Scheme for the first time on

27.11.1992, for its retired employees, as per which all

employees of DTC retiring on or after 3.8.1981, were to

be covered for the purpose of pensionary benefits. The

existing employees at the relevant time and those who

retired on or after 3.8.1981, were required to exercise

their option for the Pension Scheme. The retired

employees opting for the pension scheme were required

to refund the employer's share of provident fund received

by them with interest thereon. Those employees, who

joined the service on 27.11.1992, and thereafter, had no

option but to be compulsorily covered under the Pension

Scheme. This Court found that the employees therein

received gratuity at the time of their exit from the service

and subsequently opted for pension which had never been

4 (2001) 6 SCC 61 16

a part of their service conditions. It is under those

circumstances, this Court took the view that it was a

condition precedent that in order to get the benefit of the

Pension Scheme, they were required to refund the

gratuity received by them at the time of retirement. It

was clear that at the time of receipt of gratuity they were

not entitled to get pension. The employees have opted for

payment of pension only after the introduction of the

Scheme for the first time. DTC (supra), in our considered

opinion, is not an authority for the proposition that an

employee who receives the pension is not entitled to the

payment of any gratuity. This decision is of no assistance

to the appellant.

18. Learned counsel for the appellant has strenuously

contended that under the Old Pension Scheme of the

Bank, only two terminal benefits namely, Contributory

Provident Fund and either gratuity or pension were

required to be paid to the employees of the bank and not

both. The bank in view of the Awards, circulars and

statutory regulations is not under any legal obligation to 17

pay gratuity as a third retiral benefit. The submission was

that ever since the Payment of Gratuity Act came into

force in 1972, no employee was paid both pension and

gratuity till 1995, when the Pension Regulations came into

force. It is the case of the bank that the optional scheme

of pension prevalent at the relevant time was a better

mode of payment and therefore was a better form of

retiral benefit within the meaning of Section 4 (5) of the

Act. In this regard, he relied on the decision of this Court

in Beed District Central Coop. Bank Ltd. Vs. State of

Maharashtra & Ors.5 In that case a policy decision was

taken by the bank to extend the benefit of better rate of

gratuity to a large number of its employees and a scheme

was accordingly formulated to the effect that such of

those employees who were on its roll on and from

1.12.1975, the rate of gratuity was to be calculated on

one month's salary for every completed year of service

with ceiling limit of 20 months salary. It was operative

from 1975 to 19.7.1996. The employees of the bank

accepted the scheme and availed the benefit thereof.

5 (2006) 8 SCC 514 18

Thereafter the scheme was amended providing for

payment of gratuity at the rate of 26 days' salary for

every completed year of service with a ceiling limit of Rs.

1.7 lakhs which was operative from May, 1994 to

September, 1997. Yet again, a scheme was floated raising

the ceiling limit of Rs. 1.7 lakhs to Rs. 2.50 lakhs. The

employees retired during the currency of the scheme

formulated by the bank were offered gratuity in terms

whereof the ceiling limit was fixed at Rs. 1.7 lakhs and Rs.

2.50 lakhs between the period 20.7.1996 and 30.11.1999

and the period 1.12.1999 to 17.1.2005, respectively and

the amount of gratuity so offered to them in terms of the

scheme was accepted. However, they raised a claim that

they were entitled to the benefit of both the schemes as

also the ceiling limit fixed under the Amendment Act,

1998, raising the ceiling limit to Rs. 3.50 lakhs. On the

facts, this Court framed a question for its consideration as

to whether keeping in view the provisions contained in

sub-section (5) of Section 4 of 1972 Act, the employees

although would be entitled to the benefit of ceiling limit of

Rs. 3.5 lakhs, the rate of gratuity should be calculated at 19

the rate of 26 days' instead and in place of 15 days' salary

for every completed year of service in terms of the 1972

Act. We fail to appreciate as to how the said judgment is

of any relevance to resolve the question that arises for

our consideration in the present case. It is not the case of

the bank that at the time of superannuation of the

employees there was a scheme for payment of gratuity

under which the employees were entitled to payment of

gratuity and the said scheme in comparison to that of the

provisions of the Act was more beneficial to the workmen.

On the other hand, the scheme that was prevalent at the

relevant time in clear and categorical terms provided that

"the gratuity will not be payable in case where a pension

is granted by the Bank. But if a pensioned officer should

die before receiving any pension payments an aggregate

sum at least equal to the gratuity which he would

otherwise have received then the Bank will pay the

difference between such aggregate sum and gratuity to

the officer's widow; if any, otherwise to his legal

representative." Be it noted that in the counter affidavit

filed in the High Court the Bank placed reliance on 20

Shastry and Desai Awards which have taken the view that

Allahabad Bank which had pension scheme of its own was

more advantageous than the provisions of the gratuity to

its employees. It is asserted that under the said Awards

and the subsequent settlements an employee entitled to

receive either the benefit of pension or gratuity at his own

option but not both. The contention was that such of

those Employees who had voluntarily opted for pension

scheme were not entitled to receive the gratuity as well.

The respective comparative figures under pension and/or

gratuity, in terms of Shastry/Desai Awards and/or

Bipartite Settlement on one hand and the gratuity payable

under the Act on the other were made available for the

perusal of the Court to buttress the Bank's submission

that what has been paid to the employees was better in

terms and more favourable than the benefits conferred

under the Act. The submission is totally devoid of any

merit for more than one reason namely, that it is for the

appropriate Government to form the requisite opinion that

the employees were in receipt of gratuity or pensionary

benefits which were more favourable than the benefits 21

conferred under the Act and therefore, the establishment

must be exempted from the operation of the provisions of

the Act. The Bank having failed to obtain exemption from

the operation of the provisions of the Act cannot be

permitted to raise this plea. No establishment can decide

for itself that employees in such establishments were in

receipt of gratuity or pensionary benefits not less

favourable than the benefits conferred under the Act.

Sub-section (5) of Section 4 protects the rights of an

employee to receive better terms of gratuity from its

employer under any Award or agreement or contract as

the case may be. Admittedly the Scheme under which the

employees of the Bank received the pension was in lieu of

gratuity. There is no question of comparing the said

Scheme and arrive at any conclusion that what they have

received was much better in terms than the benefits

conferred under the Act. Reliance upon sub-section (5) of

Section 4 is therefore unsustainable.

19. This Court in Municipal Corporation Delhi vs.

Dharam Prakash Sharma & Ors.,6 observed: "the

6 (1998)7SCC 221 22

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 provision for gratuity under

the 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 employees of

such establishment are in receipt of gratuity or pensionary

benefits not less favourable than the benefits conferred

under this Act. Admittedly MCD has not taken any steps to

invoke the power of the Central Government under

Section 5 of the Payment of Gratuity Act. In the aforesaid

premises, we are of the considered opinion that the

employees of the MCD 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 23

employees cannot claim gratuity available under the

Pension Rules" (emphasis supplied).

In the present case it is not the case of the Bank that

its employees had claimed and received gratuity under the

pension scheme.

20. The decision in the case of Workman of Metro

Theatre, Bombay Vs. Metro theatre Ltd., Bombay7 in

which this Court took the view that on true construction

the expression `Award' occurring in sub-section (5) of

Section 4 does not mean and cannot be confined to

`existing Award' but includes any Award that would be

made by an adjudicator wherein better terms of gratuity

could be granted to the employees if the facts and

circumstances warrant such grant. This decision cited by

the learned counsel for the appellant is of no relevance

and in no manner supports the appellant's case.

21. Learned counsel for the appellant relying upon the

decision of this Court in Bank of India & Ors. Vs. P.O.

Swarnakar & Ors.8 contended that once the employees 7 8 (2003) 2 SCC 721 24

have exercised their option to avail pension made

available to them under the Old Pension Scheme, and

having drawn the benefits thereunder cannot be permitted

to resile from their stand. In that case a group of

employees of the State Bank of India accepted the

amount of ex-gratia under the scheme known as `the

Employees Voluntary Retirement Scheme' and thereafter

made an attempt to resile from the very Scheme itself. It

is under those circumstances this Court observed that

"those who accepted the ex-gratia payment or any other

benefit under the Scheme, in our considered opinion,

could not have resiled therefrom." In the present case

the real question that arises for our consideration is

whether the employees having exercised their option to

avail the benefits under the pension scheme are estopped

from claiming the benefit under the provisions of the Act?

The appellant being an establishment is under the

statutory obligation to pay gratuity as provided for under

Section 4 of the Act which is required to be read along

with Section 14 of the Act which says that the provisions

of the Act shall have effect notwithstanding anything 25

inconsistent therein contained in any enactment or in any

instrument or contract having effect by virtue of any

enactment other than this Act. The provisions of the Act

prevail over all other enactment or instrument or contract

so far as the payment of gratuity is concerned. The right

to receive gratuity under the provisions of the Act cannot

be defeated by any instrument or contract.

22. This Court in Hindustan Lever and Anr. Vs. State

of Maharashtra & Anr.9 relying upon the decision of this

Court in Purshottam H. Judye Vs. V.B. Poddar10 held

that the word `instrument' would include award made by

the Industrial Tribunal. It is thus clear that

notwithstanding the Desai and Shastry Awards and the

subsequent settlements the members of the employees

association are entitled to avail the benefit conferred upon

them for payment of gratuity under the provisions of the

Act. The employees cannot be deprived of their valuable

statutory right conferred upon them to receive payment of

gratuity.

9 (2004) 9 SCC 438 10 (1966) 2 SCR 353 26

23. There is no material placed before us that the

employees while opting for the pension scheme at the

time of their superannuation/retirement either expressly

or impliedly waived their statutory right to claim payment

of gratuity under the provisions of the Act. In the

circumstances we find no merit in the submission made by

the learned counsel for the appellant in this regard. For

the aforesaid reasons we find no merit in the appeal.

24. During the pendency of the appeal this Court by its

order dated 22.3.2006 directed the parties to appear

before the Controlling Authority and the Controlling

Authority was required to decide as to whether the

benefits under the Allahabad Bank Employees Pension

Scheme (Old) are more beneficial in comparison to that

of the payment of Gratuity under the provisions of the

Act. Following is the order passed by this Court:

"Though the order of the High Court speaks about the benefit of gratuity under the Payment of Gratuity Act, 1972 and a better Scheme, it does not indicate as to who is the Authority to decide which one of the schemes is better. According to the Bank, the 27

employees concerned had accepted the particular Scheme which had the option of either the pension or the gratuity. It is pointed out that the there was no challenge to the legality of the arrangement made or the Scheme itself. On the other hand, Mr. Trivedi, learned counsel for respondent no. 1 submits that whether the Scheme is better is relatable to the benefits available under the Act and nothing beyond it. The High Court has come to an abrupt conclusion that a Statute overrides an agreement. There was no plea in this regard in the writ petition. Be that as it may, we permit the parties to appear before the controlling authority who shall take a decision within three months. The parties are given liberty to produce copy of the order before the controlling authority so that it can fix a date for hearing.

The parties are permitted to take all stands which are being raised in the present appeal. The matter shall be listed after four months."

25. The Controlling Authority held that the amount

received by the employees under the said Scheme is

much more than what they could have received under the

Act. The benefits according to the Controlling Authority

available under the Scheme are more beneficial than the

gratuity payable under the Act.

28

26. Being aggrieved by the order of the Controlling

Authority two writ petitions were filed, one by All India

Allahabad Bank Retired Employees Association and the

other by the Allahabad Bank Retirees' Association

challenging the validity of the order of the Controlling

Authority dated 25.9.2006.

27. Section 2 (d) of the Act defines Controlling Authority

as an authority appointed by the appropriate Government

under Section 3 of the Act. Under Section 3 the

Controlling Authority is made responsible for the

administration of the Act and it further provides for

appointment of different authorities for different areas.

Section 7 deals with for determination of the amount of

gratuity. Every person who is eligible for payment of

gratuity under the Act is required to send a written

application to the employer in the prescribed form for

payment of such gratuity. Sub-section (2) of Section 7

provides once the gratuity becomes payable, the

employer shall, whether an application has been made or

not, determine the amount of gratuity and give notice in 29

writing to the person to whom the gratuity is payable and

also to the Controlling Authority specifying the amount of

gratuity so determined and arrange to pay the amount of

gratuity to the person to whom the gratuity is payable.

The Scheme envisaged under Section 7 of the Act, is

that in case of any dispute to the amount of gratuity

payable to an employee under the Act or as to the

admissibility of any claim of, or in relation to, an

employee payable to gratuity etc. the employer is

required to deposit with the Controlling Authority the

admitted amount payable as gratuity. In case of any

dispute parties may make an application to the Controlling

Authority for deciding the dispute who after due inquiry

and after giving the parties to the dispute, a reasonable

opportunity of being heard, determine the matter or

matters in dispute and if, as result of such inquiry any

amount is found to be payable to the employee, the

Controlling Authority shall direct the employer to pay such

amount to the employee. Sub-section (7) of Section 7,

provides for an appeal against the order of the Controlling

Authority. The Act, nowhere confers any jurisdiction upon 30

the Controlling Authority to deal with any issue under sub-

section (5) of Section 4 as to whether the terms of

gratuity payable under any Award or agreement or

contract is more beneficial to employees than the one

provided for payment of gratuity under the Act. This

Court's order could not have conferred any such

jurisdiction upon the Controlling Authority to decide any

matter under sub-section (5) of Section 4, since the

Parliament in its wisdom had chosen to confer such

jurisdiction only upon the appropriate Government and

that too for the purposes of considering to grant

exemption from the operation of the provisions of the Act.

Even on merits the conclusions drawn by the Controlling

Authority that the Pension Scheme (old) offered by the

Bank is more beneficial since the amount of money the

pensioners got under the Pension Scheme is more than

the amount that could have been received in the form of

gratuity under the provisions of the Act is unsustainable.

The Controlling Authority failed to appreciate that sub-

section (5) of Section 4 of the Act, protects the right of an

employee to receive better terms of gratuity under any 31

award or agreement or contract with the employer than

the benefits conferred under the Act. The comparison, if

any, could be only between the terms of gratuity under

any award or agreement or contract and payment of

gratuity payable to an employee under Section 4 of the

Act. There can be no comparison between a Pension

Scheme which does not provide for payment of any

gratuity and right of an employee to receive payment of

gratuity under the provisions of the Act. Viewed from any

angle the order of the Controlling Authority is

unsustainable. The order is liable to be set aside and the

same is accordingly set aside.

28. However, the judgment of ours is applicable to only

such of those employees/workmen who retired from the

service between 1.1.1986 and 31.10.1992.

29. In the result, the appeal preferred by the bank is

dismissed with costs quantified at Rs. 25,000/- and the

writ petitions are allowed without any order as to costs. 32

...................................J. (B. SUDERSHAN REDDY)

......................................J. (R.M. LODHA)

NEW DELHI, December 15, 2009.