Dismissed

Lalitha.N.v v. Viyur Service Co-Op.Bank

Kerala HC17 May 2016WP(C)/1238/2011

Case brief

AI extract

What is this about?

This petition challenged the bank's refusal to pay gratuity exceeding Rs.3.5 lakhs under the Payment of Gratuity Act. Relying on a group policy with LIC limited to the statutory cap, the court dismissed the claim for excess gratuity.

What did the court decide?

Petitioner held not entitled to any further amount beyond Rs.3.5 lakhs; writ petition dismissed.

Lalitha.N.v Vs Viyur Service Co-Op.Bank — Contract and Commercial Disputes | Kerala HC (2016)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE SMT. JUSTICE P.V.ASHA

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TUESDAY, THE 17TH DAY OF MAY 2016/27TH VAISAKHA, 1938

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WP(C).No. 1238 of 2011 (D)

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PETITIONER:

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LALITHA.N.V, AGED 61 YEARS, POOSSERY HOUSE, NETTISSERY.P.O, MUKKATTUKARA, THRISSUR DISTRICT,PIN-680 657. (RETIRED ACCOUNTANT,VIYYUR SERVICE CO-OP BANK, NO.177).

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BY ADV. SRI.C.D.DILEEP

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RESPONDENT(S):

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1.VIYUR SERVICE CO-OPERATIVE BANK LTD NO.177, P.O.VIYUR, THRISSUR DISTRICT,PIN-680 010.

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2.LIFE INSURANCE CORPORATION OF INDIA, REPRESENTED BY ITS DIVISIONAL MANAGER, JEEVAN PRAKASH, M.G.ROAD, ERNAKULAM, PIN - 682 016.

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3.JOINT REGISTRAR CO-OPERATIVE SOCIETIES (GENERAL), THRISSUR, PIN-680 003.

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4.REGISTRAR CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM, PIN - 695 001.

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R1 BY ADV. SRI.GEORGE JACOB (JOSE) R2 BY ADV. SMT.PRABHA R.MENON R3 & R4 BY GOVERNMENT PLEADER SRI.MANZOOR ALI

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THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 17-05-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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mbr/

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WP(C).No. 1238 of 2011 (D)

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APPENDIX

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PETITIONERS’ EXHIBITS:

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EXT. P1	: TRUE COPY OF THE SALARY CERTIFICATE ISSUED BY THE
	1ST RESPONDENT DATED 18.12.2010.
EXT. P2	: TRUE COPY OF THE CIRCULAR NO.25/1999 ISSUED BY THE
	4TH RESPONDENT REGISTRAR DATED 22.6.1999.
EXT. P3	: TRUE COPY OF THE REPRESENTATION GIVEN BY THE
	PETITIONER TO THE 1ST RESPONDENT DATED 18.12.2010.

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EXT. P4 :	TRUE COPY OF THE REPRESENTATION GIVEN BY THE PETITIONER TO THE 3RD RESPONDENT DATED 28.12.2010.
EXT. P5 :	TRUE COPY OF THE COMMUNICATION OF THE 1ST RESPONDENT DATED 30.12.2010 REJECTING THE EXT. P3.
EXT. P6 :	TRUE COPY OF THE REPRESENTATION GIVEN BY THE PETITIONER TO THE 3RD RESPONDENT DATED 31.12.2010.
EXT. P7 :	TRUE COPY OF THE JUDGMENT IN WP(C)17842 OF 2009 OF THIS HON’BLE COURT DATED 16.7.2009.
EXT.P7(A):	TRUE COPY OF THE JUDGMENT IN WP(C)8697 OF 2010 DATED 6.7.2010.

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RESPONDENTS' EXHIBITS:

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EXT.R1(A): TRUE COPY OF THE SCHEME.
EXT.R1(B): TRUE COPY OF THE INTIMATION.

//TRUE COPY//

P.S. TO JUDGE

mbr/

P.V.ASHA, J.

W.P(c) No.1238 of 2011-D

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Dated this the 17^th day of May, 2016

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JUDGMENT

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The petitioner, who retired from service on 31.3.2007 while working as an Accountant of Viyur Service Co-operative Bank Ltd., Thrissur, has filed this Writ Petition for a direction to the bank to release the balance amount of gratuity contending that, she is entitled to gratuity at the rate of 15 days of wages per year of service, despite the ceiling on the amount of gratuity under the Payment of Gratuity Act. According to the petitioner, the 1^st respondent has entered into an agreement with the 2^nd respondent Life Insurance Corporation (`L.I.C' for short) in the light of Group Gratuity-cum-Life Assurance Scheme. Based on that agreement, the L.I.C is making payment towards the gratuity. The petitioner submits that, she was paid only a sum of Rs.3.5 lakhs towards gratuity even though she has rendered a total period of 40 years of service with her last pay drawn as Rs.19,376/-. She had submitted representations before the bank relying on the judgment of this Court in the decision reported in

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W.P(c) No.1238 of 2011-D

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Ratnavalli v. Ambalappad Service Co-op. Bank Limited [2005(3) KLT 320].

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The bank as well as the Government have filed counter affidavits saying that, the petitioner is not entitled to any further amount than what was already paid, ie. in excess of Rs.3.5 lakhs. According to the bank, the entire amount paid by the L.I.C towards gratuity was paid to the petitioner. They have produced the copy of the Scheme framed by the Corporation in respect of payment of gratuity, under which the Society had constituted group Gratuity Cash Accumulation Scheme. It is stated that, under the said Scheme, the employees are entitled only to the maximum amount of Rs.3.5 lakhs and pursuant to the petitioner's retirement, the 2^nd respondent L.I.C made over a cheque dated 27.3.2007 for a sum of Rs.3.5 lakhs as per Ext.R1 (b) intimation and accordingly that amount was paid to the petitioner.

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I have heard the learned counsel on either side.

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The learned counsel for the respondents has furnished a copy of the judgment reported in Nedupuzha Service Cooperative Bank Ltd. v. K.Rugmani and Others [2011 (2) KHC 880], which was rendered in identical situation. In paragraph 6

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W.P(c) No.1238 of 2011-D

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of that judgment, cases under the similar circumstances are considered. Therein, the Division Bench held as follows:

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“6. xxxx xxxx xxxx xxxx The claim is in excess of statutory limit of Rs.3.5 lakhs provided under S.4(3) of the Act. It is seen that Group Gratuity Policies taken by the appellant Banks with the LIC limited the gratuity liability to each of the employee including the respondents at the maximum amount of Rs.3.5 lakhs provided under S.4(3) of the Act. Admittedly, the LIC has collected premium from the appellants for the maximum amount of gratuity payable under the statute to each of the employee. We do not know on what basis the respondents can claim gratuity in excess of statutory limit, which is covered in the Policies taken by the appellant Banks. As already held above, benefit of the employees is limited to the gratuity amount receivable under the Policy, and when it is limited to the statutory amount of Rs.3.5 lakhs, the LIC passes on only the said amount to the appellants, which in turn should go to the employees. The respondents' case is based on circular No.25/99, which also does not say that the appellants have any liability over the statutory limit of Rs.3.5 lakhs. We, therefore do not find any basis for the learned Single Judges to hold that appellants are entitled to gratuity over and above the statutory limit, which is covered by the policies and passed on by the appellants to the respondent employees on receipt from the LIC. Accordingly, WA Nos.980, 982, 1233, 1666, 1924 of 2010, 470 & 472 of 2011 are allowed vacating the judgments of the learned Single Judges under appeals.”

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