1973 (3) TMI 117 - SC - Indian Laws

The Scheme of gratuitty applicable to the appellant Estate provided that a dispute regarding a claim for payment of gratuity of a workman who had been dismissed for misconduct shall be referred to the Labour Court for decision. One of workmen of the appellant was chargesheeted in respect of riotous and disorderly behaviour for having assaulted a tea-maker inside the factory of the appellant. A departmental enquiry was held and being found guilty of misconduct he was dismissed. As a dispute arose about the payment of gratuity the matter was referred to the Labour Court. Before the Labour Court it was not disputed that the dismissal of the workman was on account of misconduct consisting of riotous and disorderly behaviour and assaulting a tea-maker. The Labour Court, relying upon the decision of this Court in State of Punjab v. Suraj Prakash Kapur, 1962 2 S.C.R. 711 decided the question in favour of the workman. Appeal by special leave, was filed in this Court. Allowing the appeal.

Summary

Issues:
1. Dispute over payment of gratuity to a dismissed workman.
2. Forfeiture of gratuity due to serious misconduct.
3. Application of principles from previous judgments in determining gratuity entitlement.

Analysis:
The case involved a dispute regarding the payment of gratuity to a workman who was dismissed for misconduct. The workman was found guilty of assaulting a supervisor, leading to his dismissal. The gratuity scheme in place allowed for the referral of such disputes to the Labour Court for resolution. The workman claimed entitlement to gratuity despite the misconduct allegations, citing his long years of service. The management, on the other hand, argued that the serious misconduct warranted forfeiture of gratuity.

The Labour Court referred to previous judgments to determine the forfeiture of gratuity for misconduct. It was highlighted that misconduct could be of various kinds, with serious misconduct such as violence or disorderly behavior leading to complete forfeiture of gratuity. The Court emphasized the importance of maintaining discipline and industrial harmony in such cases. The Payment of Gratuity Act was also referenced, which provided for the forfeiture of gratuity in cases of riotous or disorderly conduct.

The respondent's counsel argued that the Labour Court did not adequately consider the nature and severity of the misconduct before making its decision. However, the Court found that the facts were clear and not in dispute, negating the need for a remittance to the Labour Court. Ultimately, the Supreme Court allowed the appeal, setting aside the Labour Court's award and declaring that the workman was not entitled to the gratuity earned. The respondents were awarded costs as per a previous court order.

In conclusion, the judgment clarified the principles governing the forfeiture of gratuity in cases of serious misconduct and upheld the decision to deny gratuity to the workman based on the nature of his misconduct. The case underscored the significance of maintaining discipline in the workplace and ensuring that actions leading to serious misconduct have consequences, including the potential loss of retirement benefits.