Payment Of Gratuity Act, 1972 Has An Overriding Effect On CCS Pension Rules, 1972: Central Administrative Tribunal, New Delhi

The Central Administrative Tribunal Principal Bench, New Delhi bench of Pratima K. Gupta (Judicial Member) held that the Payment of Gratuity Act, 1972, being an act of Parliament will have an overriding effect on the CCS Pension Rules, 1972. The CCS Pension Rules, 1972, refer to the Central Civil Services (Pension) Rules, which outline the provisions for the pension and retirement benefits for government employees who are covered under the Central Civil Services. Brief Facts: The Applicant served as an Upper Division Clerk (UDC) with the Controller of Defence Accounts on a temporary basis from 1961 and was regularized in 1965. However, he resigned from his position on May 1, 1973, after submitting a technical resignation. Nearly 45 years later, on July 7, 2020, he sought the release of his gratuity, which was rejected by the department through an order. Feeling aggrieved, the Applicant approached the Central Administrative Tribunal Principal Bench, New Delhi (“Tribunal”), and filed an original application challenging the order of the department. The Applicant argued that the impugned order incorrectly applied Rule 26(1) of the CCS Pension Rules, 1972, which pertains to the forfeiture of service upon resignation. He contended that this rule, which relates to pension, does not address gratuity. He argued that having served for more than five years, he was entitled to gratuity under the Payment of Gratuity Act, of 1972. He referred to Section 14 of the Payment of Gratuity Act, which stats the Act's supremacy over any conflicting enactment or contract. Observations by the Tribunal: The Tribunal noted that the Applicant served the department for a total of 12 years, with 8 years as a confirmed employee which made him ineligible for pension. However, regarding gratuity, the Tribunal held that Rule 26 of the CCS Pension Rules, 1972 doesn't apply. Instead, it held that the Payment of Gratuity Act, 1972, specifically Section 4(1)(b), governs the entitlement to gratuity upon resignation. It held that this section unequivocally states that any employee resigning from service after completing a minimum of five years is entitled to gratuity. Further, the Tribunal held that the CCS Pension Rules, 1972, serve as regulations for employee service conditions, while the Payment of Gratuity Act, 1972, stands as an overriding legislation passed by Parliament. Therefore, it held that the Applicant's case fell squarely within the purview of the Gratuity Act and did not fall under any provisions that would render it non-applicable. Consequently, the Tribunal directed the department to release the withheld gratuity of the Applicant within eight weeks from the receipt of a certified copy of the order. However, it held that the applicant was not entitled to any interest on the withheld gratuity. Case Title: Johri Mal vs Union of India and Anr Case Number: O.A. No. 2266/2021 Advocate for the Applicant: Mr. Asish Nischal Advocate for the Respondent: Mr. H.K. Gangwani Click Here To Read/Download Order

Payment Of Gratuity Act, 1972 Has An Overriding Effect On CCS Pension Rules, 1972: Central Administrative Tribunal, New Delhi

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Payment Of Gratuity Act, 1972 Has An Overriding Effect On CCS Pension Rules, 1972: Central Administrative Tribunal, New Delhi

Rajesh Kumar

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