The petitioner through the medium of the present writ petition has sought a direction upon respondents No.1 and 2 to make payment of the amount due to him on account of gratuity and leave salary with a further direction that interest be awarded in his favour on the unpaid amount due.
The petitioner was appointed as Techno Economic Analyst with Jammu & Kashmir and Ladakh Financial Corporation (JKLFC) in terms of order No.PS/26/10-701 dated 20.12.2010. Vide Government Order No.470-GAD of 2013 dated 19.03.2013, the petitioner was deputed to the Jammu and Kashmir Power Development Corporation (JKPDC). The petitioner’s service with the borrowing corporation was initially for a period of 15 months from 01.01.2012 to 25.03.2013 and thereafter for about 84 months from 25.03.2013 to 31.03.2020. The petitioner tendered his resignation which was accepted by his parent organization on 20.02.2020, whereafter he joined State Bank of India, Mumbai, on 21.02.2020.
After the resignation of the petitioner, the whole of the leave encashment salary and gratuity has not been released by the respondents. The stand of the parent organization JKLFC is that provident fund in the amount of Rs.6,52,798/- has already been released. With regard to leave encashment salary and gratuity amount, the same has been considered for release by the management but its release got delayed for the reason that the petitioner has served with respondent No.2-JKPDC for a significant period of time. The case of the petitioner was referred to the Administrative Department (Finance Department) seeking its advice/opinion and in response thereto, the Finance Department vide communication 11.01.2024 conveyed that post-retirement benefits of the petitioner should be released after seeking necessary contribution from JKPDC for the period he was employed with the said organization. In view of the opinion of the Finance Department, the matter has been taken up with respondent No.2 requesting them to release proportionate quantum of leave encashment salary and admissible gratuity amount for the period for which the petitioner has served with the said organization.
Respondent No.2-JKPDC, in its reply, has submitted that the claim of the petitioner was examined and found to be without force. As per Rule 12(a) of Schedule XVIII to J&K Civil Service Regulations, which relates to standard terms of deputation, it is the parent organization which has to decide the claim of the petitioner. A detailed speaking order dated 30.01.2023 was issued by respondent No.2 in which it was clearly stated that the petitioner has no right to claim any service benefits from the said respondent. The claim of the petitioner, if any, has to be determined by the parent organization i.e. JKLFC under the applicable rules.
The factual aspects of the matter are not in dispute. The petitioner was initially appointed with respondent No.1 and his services were deputed to respondent No.2 in terms of a valid Government Order passed by the General Administration Department. He continued to work with the borrowing department i.e. respondent No.2 until he tendered his resignation which was accepted by the parent organization on 20.02.2020. The only question that has to be determined in this case is as to which of the two respondents, the parent organization or the borrowing organization, has to pay the dues of the petitioner. While the parent organization has taken a stand that the liability in this regard has to be shared by respondents No.1 and 2 in proportion to the period for which the petitioner has worked with these two organizations, respondent No.2 has taken a stand that it is the liability of the parent organization to pay the retiral dues to the petitioner.
The provisions contained in Schedule XVIII of the J&K CSR, which governs the standard terms of deputation, provide a guideline as to which of the organizations has to pay the leave salary or other pensionary benefits. Rule 12 of the said Schedule is relevant. During the period of deputation sanctioned to the grant of leave etc. including advances from G.P. Fund will be regulated as under: (a) where deputation is to a Corporation, Company, Autonomous Body or any other Non-Government Organisation, the sanction to leave, G.P. Fund advances/withdrawals etc. and the disbursement of leave salary and advances will be made by the parent department.
So far as the release of gratuity is concerned, the same is, admittedly, liability of the parent organization. The gratuity, in terms of Article 240-BB of the J&K CSR has to be paid by the parent organization at the time of retirement or death of an employee. Therefore, it is respondent No.1 which has to pay the amount of gratuity to the petitioner. Respondent No.1 has abdicated its duty of releasing amount of gratuity in favour of the petitioner and has unnecessarily engaged itself in inter-departmental communications with the Finance Department and respondent No.2. This attitude of respondent No.1 has resulted in delay of several years in release of gratuity in favour of the petitioner. In terms of Section 7(3-A) of Payment of Gratuity Act, if the amount of gratuity is not paid within thirty days from the date it becomes payable, the employer has to pay simple interest at the rate not exceeding the rate notified by the Central Government from time to time. As per the Notification, the rate of interest is 10% per annum.
The Note appended to Rule 12 provides for reference to Government Instructions below Article 185-B of the J&K CSR. The Government Instructions appended to Article 185 of the J&K CSR provide that for purpose of drawn of leave salary by a Government servant while on deputation with foreign employer, the latter will maintain leave account of the Government servant concerned. An extract of the leave account shall be supplied to the foreign employer by the parent Department of the deputations. The foreign employer will assess the leave admissible to the Government servant concerned and sanction it under intimation to the parent Department of the Government servant. The payment of leave salary will be made by the foreign employer. The latter will claim the reimbursement of leave salary from the concerned State Government half yearly. The foreign employer will send to the parent department of the deputationist the claim for leave salary reimbursement duly supported with details regarding nature and period of leave sanctioned, rate of leave salary and the amount paid to the deputationist. The parent Department should verify the claim preferred by the foreign employer and arrange reimbursement of the amount within a month from the receipt of the claim. The procedure regarding payment of leave salary applicable to cases relating to deputation on foreign service has to be made applicable to release of leave salary in the case of employees deputed to Corporation, Company, Autonomous Body etc.
In the present case, respondent No.2, the borrowing organization, had to sanction leave salary in favour of the petitioner under intimation to respondent No.1 and thereafter release the amount of leave salary to the petitioner. After undertaking the aforesaid exercise, respondent No.2 had to seek reimbursement of amount released in favour of the petitioner by way of leave salary from respondent No.1. Instead of doing so, respondent No.2 has simply denied entitlement of the petitioner to leave salary and its liability to pay the same, which is contrary to the provisions contained in J&K CSR which are applicable to both respondent No.1 as well as to respondent No.2.
For what has been discussed hereinbefore, the writ petition is disposed of in the following manner: (I) Respondent No.1 is directed to release the amount of gratuity due to the petitioner in accordance with rules forthwith along with interest @10% per annum from 30 days after acceptance of his resignation till the amount is actually paid by it to the petitioner. (II) Respondent No.2 shall calculate the amount of leave salary due to the petitioner and release the same in his favour within a period of one month with a right to claim reimbursement of the same from respondent No.1. The said respondent shall also be liable to pay interest @6% per annum on the amount of leave salary payable to the petitioner from the date of filing of this writ petition till its realization.
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