Dismissed¶45

The Chairman And Managing Director v. The Appellate Authority Under The Payment Of Gratuity Act

Chhattisgarh HC7 Jul 2025WPL/43/2019

Case brief

AI extract

What is this about?

Payment of Gratuity Act 1972 s.4(6); forfeiture/withholding of gratuity; compulsory retirement; disciplinary charges admitted; 14 loan accounts; more than 200 lakhs jeopardised; no termination-of-services or loss finding; Bank of Maharashtra; Appellate/Controlling Authority orders upheld; Writ Petition (WPL) 43/2019; Chhattisgarh High Court; 2025:CGHC:31259; decided 08/07/2025; Justice Rakesh Mohan Pandey; petition dismissed.

What did the court decide?

None — the petition failed and was dismissed; the orders of the Controlling Authority and Appellate Authority under the Payment of Gratuity Act, 1972 were left undisturbed. ¶45

The Chairman And Managing Director Vs The Appellate Authority Under The Payment Of Gratuity Act — Chhattisgarh HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

None — the petition failed and was dismissed; the orders of the Controlling Authority and Appellate Authority under the Payment of Gratuity Act, 1972 were left undisturbed.

¶45

Issue for consideration

Whether the gratuity of respondent No. 3 — whose penalty was compulsory retirement after he admitted charges alleging jeopardy to over Rs. 200 lakhs in 14 loan accounts — is liable to forfeiture/withholding under Section 4(6) of the Payment of Gratuity Act, 1972, given that the Disciplinary Authority recorded no finding of termination of services or of loss caused to the employer's property.

¶42

Court's answer

On a bare reading of Section 4(6) of the Payment of Gratuity Act, 1972, where an employee's services have been terminated and he has been found guilty of any omission, negligence or causing loss to the property belonging to the employer, the employer may pass an order withholding gratuity to the extent of the loss caused by such employee to the employer's property.

¶41

Ratio / Principle

In the present case the Disciplinary Authority recorded no finding of termination of services or of loss caused to the property belonging to the employer; respondent No. 3 admitted all the alleged charges and the penalty imposed was compulsory retirement; therefore forfeiture under Section 4(6) could not be sustained and the petitioners' contention was rejected.

¶42

Key takeaways

Considering Section 4(6) of the Act of 1972, the Disciplinary Authority's order and the findings of the Controlling Authority affirmed by the Appellate Authority, there was no good ground to interfere with the orders passed by the Controlling Authority and the Appellate Authority under the Act of 1972.ratio¶44

Detailed headnote1 paragraphs

High Court of Chhattisgarh at Bilaspur — WPL No. 43 of 2019 (2025:CGHC:31259), order dated 08/07/2025 by Hon'ble Shri Justice Rakesh Mohan Pandey. The Chairman-cum-Managing Director and the Zonal Manager of Bank of Maharashtra petitioned to quash (i) the Controlling Authority's order dated 09/11/2012 in Case no. RP-48 (11)/2012-ALC and (ii) the Appellate Authority's order dated 30/05/2013 in Case no. PGA 02/2013 under the Payment of Gratuity Act, 1972, which had allowed gratuity to respondent No. 3, Prafull Chandra Naik, formerly Senior Manager at the bank's Zonal Office, Raipur, who had been penalised with compulsory retirement vide order dated 28.09.2011 after admitting charges (article of charge dated 07.06.2011) that in 14 loan accounts more than Rs. 200 lakhs plus unapplied interest was put in jeopardy; the petitioners also prayed for remand and for blocking release of the deposited gratuity-plus-interest of Rs. 10,61,416. Deciding the matter on Section 4(6) of the Act of 1972, the Court held that forfeiture is permissible where services have been terminated for wilful omission or negligence causing loss to the employer's property (or for riotous/disorderly conduct or an offence involving moral turpitude committed in employment); here the penalty was compulsory retirement, with no finding of termination of services or of loss caused to the employer's property, so the contention of Dr. Sourabh Kumar Pande could not be accepted. Finding no good ground to interfere with the orders of the Controlling and Appellate Authorities, the petition was dismissed.

¶1

¶2

Digitally signed by RAMESH KUMAR VATTI Date: 2025.07.14 15:02:31 +0530

¶3

2025:CGHC:31259

¶4

NAFR

¶5

HIGH COURT OF CHHATTISGARH AT BILASPUR

¶6

WPL No. 43 of 2019

¶7

1 - The Chairman And Managing Director Bank Of Maharashtra, Lokmangal, 1501 Shivaji Nagar, Pune Maharashtra 411005 Civil And Revenue District Pune (Maharashtra) Police Station Shivajinagar, District Pune (Maharashtra)

¶8

2 - The Zonal Manager, Bank Of Maharashtra, Zonal Office, Chawla Complex, Devendra Nagar, Raipur (Chhattisgarh) 492001 Civil And Revenue District Raipur (Chhattisgarh) Police Station Devendra Nagar, Raipur, District : Raipur, Chhattisgarh

¶9

... Petitioner

¶10

versus

¶11

1 - The Appellate Authority Under The Payment Of Gratuity Act, 1972, And The Regional Labour Commissioner (Central) D/6, Adarsh Society, Sector-1, Avanti Vihar, Raipur (Chhattisgarh) 492001 Civil And Revenue Distt. Raipur . Police Station Civil Lines, Raipur, Chhattisgarh

¶12

2 - The Controlling Authority Under The Payment Of Gratuity Act, 1972, And The Assistant Labour Commissioner (Central) D/6, Adarsh Society, Sector-1, Avanti Vihar, Raipur (Chhattisgarh) 492001 Civil And Revenue Distt. Raipur Police Station Civil Lines, Raipur, District : Raipur, Chhattisgarh

¶13

3 - Prafull Chandra Naik R/o C/o A.K. Bose A-69, Near Shiv Mandir Agyeya Nagar, Bilaspur (Chhattisgarh) 495001 Civil And Revenue Distt. Bilaspur Police Station Civil Lines, Bilaspur , District : Bilaspur, Chhattisgarh

¶14

... Respondents

¶15

For Petitioners : Dr. Sourabh Kumar Pande, Advocate For Respondent No. 3 : Mr. Arun Kumar Bose, Advocate

¶16

Hon’ble Shri Justice Rakesh Mohan Pandey Order on Board

¶17

08/07/2025

¶18

The petitioners have filed this petition seeking the following relief(s):-

¶19

10(1) To kindly, call the records from the court below.

¶20

10(2) To kindly, quash the Order dated 30/05/2013 in Case no. PGA 02/2013 passed by the Appellate Authority, and the

¶21

¶22

Regional Labour Commissioner (Central), Raipur, Chhattisgarh [Annexure-P 1] and Order dated 09/11/2012 in Case no. RP-48 (11)/2012-ALC passed by The controlling Authority Under Payment of Gratuity Act, 1972 and The Assistant Labour Commissioner (C), Raipur (C.G.) [Annexure-P 2] .

¶23

10(3) To kindly, remanded the case of the Respondent No. 3 back to the Petitioners in order to decide the same reasonably after providing proper opportunity of hearing to Respondent No. 3 on the point of loss suffered by the Petitioner bank due to the actions of Respondent No. 3 and on the point of forfeiture of the entire gratuity amount.

¶24

10(4) To kindly, allow the present writ petition in favour of the Petitioners.

¶25

10(5) To kindly, direct the Appellate Authority, and the Regional Labour Commissioner (Central), Raipur, Chhattisgarh not to release the Gratuity Amount plus interest [‘10,61,416 (Rupees Ten Lakhs Sixty One Thousand and Four Hundred Sixteen only)] deposited with it by the Petitioners to Respondent No. 3 till the final disposal of the present writ petition if in case it has yet not been released to Respondent No. 3.

¶26

10(6) To kindly, direct the Respondent No. 3 to deposit the Gratuity amount plus interest with the Petitioners if the same has been released to him by Appellate Authority and the Regional Labour Commissioner (Central), Raipur, Chhattisgarh in case the present writ petition is allowed in favour of the Petitioners.

¶27

10(7) Any other relief which this Hon’ble Court deems fit in the interest of justice may also be provided.

¶28

Dr. Sourabh Kumar Pande, learned counsel appearing for the petitioners would submit that petitioner No. 1 is Nationalised Bank. Respondent No. 3 was an Officer of respondent-bank and at the relevant time he was working to the post of Senior Manager at Zonal Officer at Raipur. He would submit that respondent No. 3 was found guilty of charges of not taking all possible steps to ensure and protect the interest of the bank and to discharge duties with utmost integrity, honesty, devotion and diligence as stated in article of charge dated 07.06.2011. He would further submit that respondent No. 3 admitted the allegations made against him that in 14 loan accounts, an amount

¶29

¶30

of more than 200 lakhs plus unapplied interest was put in jeopardy. He would contend that the Disciplinary Authority inflicted punishment of compulsory retirement vide order dated 28.09.2011. He would further contend that thereafter respondent No.3 moved an application before the Controlling Authority under the Payment of Gratuity Act, 1972 (for short 'Act of 1972') for payment of gratuity and it was allowed vide order dated 09.11.2012. He would further submit that the petitioners preferred appeal before the Appellate Authority under the Act of 1972 and it was dismissed vide order dated 31.05.2013. Dr. Pande would submit that there is admission on the part of respondent No.3 that he admitted all 14 charges and penalty of compulsory retirement was inflicted by the Disciplinary Authority. He would submit that the Controlling Authority as well as Appellate Authority under the Act of 1972 ought to have considered this aspect. He would pray to quash both the orders.

¶31

On the other hand, Mr. Arun Kumar Bose, learned counsel appearing for respondent No. 3 would oppose. He would submit that the order of termination or any finding with regard to willful omission, negligence or causing loss to the property belonging to employer have not been inflicted against respondent No.3, therefore, the Controlling Authority as well as Appellate Authority rightly allowed the application moved by respondent No. 3.

¶32

I have heard learned counsel for the parties and perused the documents.

¶33

Sections 4 (6) of the Act of 1972 reads as under:-

¶34

“ 4. Payment of gratuity. -

¶35

(6) Notwithstanding anything contained in sub-section (1),-

¶36

¶37

(a) the gratuity of an employee, whose services have been terminated for any act, wilful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer shall be forfeited to the extent of the damage or loss so caused;

¶38

(b) the gratuity payable to an employee [may be wholly or partially forfeited]-

¶39

(i) if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or

¶40

(ii) if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment.”

¶41

Bare reading of this provision would make it clear that if services of an employee have been terminated and he has been found guilty of any omission, negligence or he has caused loss to the property belonging to the employer in such a situation order to withhold the amount of gratuity can be passed by the employer to extent of loss caused by such employee to the property belonging to the employer.

¶42

In the present case, there is no such finding recorded by the Disciplinary Authority in its order whereby penalty of compulsory retirement was inflicted. Respondent No. 3 admitted all the alleged charges levelled against him and consequently penalty of compulsory retirement was inflicted. As there is no punishment of termination of services or findings with regard to any loss caused to the property belonging to the employer, therefore, the contention made by Dr. Pande cannot be accepted.

¶43

¶44

Taking into consideration the provisions of Section 4 (6) of the Act of 1972; the order passed by the Disciplinary Authority; further findings recorded by the Controlling Authority and affirmed by the Appellate Authority, I do not find any good ground to interfere with the orders passed by the Controlling Authority as well as Appellate Authority under the Act of 1972.

¶45

Consequently, the petition fails and is hereby dismissed .

¶46

Sd/-

¶47

(Rakesh Mohan Pandey) Judge

¶48

vatti

The Chairman And Managing Director v. The Appellate Authority Under The Payment Of Gratuity Act

Case brief

What is this about?

What did the court decide?

The Chairman And Managing Director v. The Appellate Authority Under The Payment Of Gratuity Act

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

Procedural history

Parties & counsel

Coram

Case details

Similar cases

Chhote Lal Dahire Vs State Of Chhattisgarh

Khileshwar Sinha Vs Rehana Begam @ Ashu

Amrika Bai Vs State of Chhattisgarh

Anand Kumar Vs State of Chhattisgarh

Nitesh More Vs Smt. Chanchal More

Maa Sharda Mahila Swa Sahayata Samuh Vs State of Chhattisgarh