The Madras High Court has turned down the plea of a Chennai-based company to allow waiver of gratuity payment to its workers under the Sick Industrial Companies (Special Provisions) Act, 1985.
The India Radiators Ltd, in its writ petition before the Court, challenged a recovery notice dated April 2, 2003, issued by the Assistant Commissioner of Labour (authority under the Payment of Gratuity Act) in connection with its liability for gratuity. Dismissing the petition, Mr Justice K. Chandru ruled that as held by a Full Bench of this Court in Gowri Spinning Mills (P) Ltd vs Asst PF Commissioner, Salem [reported in 2006 (4) LLN 441], impunity claim could not be granted in respect of the petitioner's dues to workmen. Though the petitioner attempted to contend that it applied to claims under PF and ESI, where there were non-abstaining clauses available, the same was not applicable to payment of gratuity.
According to the petitioner, by the impugned notice, the Tahsildar, Mylapore-Triplicane Taluk, Chennai (R-2), in whose favour the revenue recovery certificate was issued, had sent a communication to the company stating that their claim for impunity under the Sick Industrial Companies Act would not apply to gratuity payment. R-2 had, therefore, directed the company to pay gratuity within three days failing which the revenue recovery mechanism would be set in motion. The present writ petition was to challenge the said direction of R-2.
The petitioner submitted that under Art 226 of the Constitution, this Court had power to waive gratuity. Also, under Section 8 of the Gratuity Act, if the payment was not made within the prescribed time, the authority empowered to receive the dues, was also bound to recover the said amount with 10 per cent interest per annum.
When once the Act empowered the authority to recover the amount due from the employer, this Court could not by issuance of a writ interdict a statutory right conferred on the workmen, the judge held.
The writ petition stood dismissed.