Married Daughter Eligible For Ex-Gratia & Leave Encashment If Sole Legal Heir: Madhya Pradesh High Court

The Madhya Pradesh High Court has held that a married daughter is entitled to receive leave encashment and ex gratia payments if she is the only legal heir of the deceased.

The division bench of Justice Vivek Rusia and Justice Pradeep Mittal, while referencing the notification of 14th November 1972, observed,

"The above notification does not debar the married daughter. The above rule is made to resolve the controversy between the legal heirs of the deceased, meaning thereby if the deceased is having more than one son/daughter, then the eldest son is only eligible to get exgratia. Secondly, if the eldest daughter is married, then she ousts the son to get the ex-gratia. Thirdly, on this point, the notification is silent as to if there are no heirs other than a married daughter, then who will receive the ex-gratia. Meaning thereby, the married daughter is not excluded if she is the only legal heir of the deceased".

A petition was filed by the daughter of the driver employed in the district court of Narsinghpur, challenging the orders of the respondents (High Court) wherein she was denied payment of ex gratia and leave encashment.

The father, during the course of his service, expired on May 9, 2024. During his lifetime he had nominated his wife but she died before him. Therefore, he changed the nomination from his wife to his daughter (the present petitioner) in the official service record.

The petitioner, after her father's demise, applied for the settlement of retirement and service benefits. She was granted GPF and the amount under the Karmchari Group Insurance Scheme. However, the ex gratia and leave encashment payments were rejected on the grounds that a married daughter was not entitled to receive such benefits.

The counsel for the petitioner contended that the rejection on the grounds that she was the married daughter of the deceased was arbitrary, illegal and violative of Article 14 of the Constitution.

The counsel for the respondents claimed that, per the applicable rules, mere nomination does not confer an absolute right to all service benefits and that under the prevailing policy, a married daughter was not covered within the eligible category.

The court, relying on the case of Meenakshi Dubey v. M.P. PoorvaKshetra Vidyut Vitran Co. Ltd highlgihted that a daughter, even after marriage, remains part of the family and cannot be treated as not belonging to her father's family.

The court further observed,

"Depriving an employee of leave encashment is violative of Article 300A of The Indian Constitution. The Court stated that the employee has chosen to accumulate his earned leave to his credit and encashment becomes his right. The employer cannot deny an employee of such right. The right to leave encashment is a statutory right which cannot be forfeited by explicit statutory provision".

The court emphasized that the rights relating to leave encashment, pension and gratuity cannot be deprived without due process of law and that the death of an employee would not negate the rights of the employee held at the time of retirement.

The bench, further relying on the notification of 14th November 1972, highlighted that the notification does not bar a married daughter from consideration but merely clarifies that a married daughter would be entitled to such payments if she is the only legal heir of the deceased employee.

Additionally, the court clarified the nature of ex gratia payments, noting

"ex gratia paid to the employee after his death immediately, probably on the same day, shows that the amount is for performing the funeral ceremony of the employee, hence, it cannot be denied on the ground that the married daughter cannot claim it".

Thus, the court held that the married daughter/ petitioner was entitled to receive ex gratia and leave encashment payment. Therefore, the court allowed the petition and directed the respondents to pay the said amounts within 60 days.

Case Title: Prasanna Namdev (Soni) v High Court of MP [WP-37546-2024]

For Petitioner: Advocate Durgesh Kumar Singrore

For Respondent: Advocate Shobhitaditya

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