IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA CWP No.12648 of 2024 Decided on 18th December 2025 State of Himachal Pradesh and others …Petitioners Versus Gorkh Ram …Respondent Coram Hon’ble Mr. Justice Ajay Mohan Goel, Judge 1Whether approved for reporting? For the petitioners: Mr. Rajpal Thakur, Additional Advocate General. For the respondent: Ms. Pooja Thakur, Legal Aid Counsel. Ajay Mohan Goel, Judge (Oral) By way of this petition, the petitioners have prayed for the following relief:- “That the impugned order dated 06.03.2024 (Annexure P-1) passed by the Deputy Labour Commissioner-cum-Appellate Authority may kindly be quashed and set aside in the interest of justice and fair play.” 2. The petitioners-State has assailed the order passed by Deputy Labour Commissioner-cum-Appellate Authority under Section 7 (7) of the Payment of Gratuity Act, 1972, in terms whereof, the Appellate Authority dismissed the appeal 2 filed by the petitioner and upheld the order passed by the learned Controlling Authority-cum-Labour Officer Bilaspur in the gratuity claim filed by the present respondent. 3. I have heard learned Additional Advocate General and learned Legal Aid Counsel and have also carefully gone through the pleadings and the documents appended with the petition including the impugned order. 4. A perusal of the record demonstrates that respondent Gorkh Ram filed an application under the Payment of Gratuity State Rules before the Controlling Authority for issuance of a direction to the employer to pay the due amount of gratuity to the claimant. According to Gorkh Ram, he had served as a Chowkidar with effect from the year 1998 upto 31.12.2017 and accordingly, he claimed gratuity for the said period. The application of Gorkh Ram was allowed by the Controlling Authority, in terms of order Annexure P-2, dated 25.03.2020. The Controlling Authority while allowing the application returned the findings that Gorkh Ram had continuously worked for 19 years i.e., with effect from the month of January, 1999 upto 31.12.2017 with the employer 3 both on daily wage basis as well as regular basis. The Controlling Authority further held that in terms of Section 4(1) of the Payment of Gratuity Act the employee was entitled for payment of gratuity on termination of his service after rendering continuous service of not less than 5 years on his superannuation, retirement or resignation or death or disablement. Learned Authority thus held that as Gorkh Ram remained an employee of the establishment he was covered under the definition of Section 2(e) of the Act and, establishment being a Government Department was governed by various laws in force and, therefore, the establishment was liable to pay gratuity to the workman. The relevant portion of the order passed by the Controlling Authority is quoted herein below:- “I have heard the arguments of both the parties and gone through the record, the record placed before me, I have come to the conclusion that the applicant/claimant is entitled for the payment of gratuity as he had continuously worked for 19 years w.e.f. January, 1999 to 31.12.2017 with the respondent employer. On daily wages as well as on regular basis which is evident from the reply and mandays chart/statement showing the list of detail of daily wages workers duly signed by the Divisional Forest Officer Bilaspur, H.P. Moreover, this Act is a social legislation and we live in a 4 welfare state, in a socialist republic under the constitution which profound concern for the weaker classes including workers and welfare benefits such as pension, payment of provident fund and gratuity are in fulfillment of directive principles. The workman/applicant had worked 19 years with the employer/respondent continuously including daily wage services and as per section 411) of the abid Act an employee is entitled for payment of gratuity on the termination of his employment after he has rendered continuous service for not less than 5 years on his superannuation, on his retirement or resignation or on his death or disablement. The workman Sh. Gorkh Ram remained as employee of the respondent establishment and in covered under the definition of section 2 (e) of the said Act and the establishment of the employer is also covered under section 1/24b) (c) of the ibid Act. The establishment of the respondent is a Govt. department and is governed under so many Acts, Rules and Regulations such as the Industrial Dispute Act, 1947, the Minimum Wages Act, 1948, the Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959 and so many service rules regulating the services the employees of the department. The Forest Department is also an establishment within the meaning of section 2(g) of the Payment of Wages Act, 1936 wherein the work relating to construction, development etc. is carried on. The Acts & Rules mentioned herein are dealing with the establishments and are applicable on the establishment of the respondents and as such the Act is equally applicable on the establishment of the respondent. The formula of calculation of payment of gratuity has been given under section 4(2) of the aforesaid Act is as under:- Total length of service of Sh. Gorkh Ram with the employer w.e.f. January, 1999 to 31.12.2017 is 19 years. Last wages drawn is Rs.19,718/- per month only. 5 Eligibility for the payment of gratuity:- 19,718x19x15/26=2,16,140/-(Rupees two lakh sixteen thousand one hundred forty only). The amount of gratuity i.e. Rs.78,872/- has already been received by the applicant. This amount shall be deducted from this amount. Therefore the due amount of gratuity of Rs.2,16,140- 78872=1,37,268/-(Rupees one lakh thirty seven thousand two hundred sixty eight only) is determined to the claimant. Further the applicant should be paid interest on the delayed payment of gratuity @ 9% simple interest per annum from the date of filing the application till the payment is actually made to him. Keeping in view of the aforesaid facts and findings, I order that due admissible amount of gratuity be paid to the applicant by the respondent/employer for the services rendered by the applicant within one month in accordance with the provisions of the payment of gratuity Act, 1972 and aforesaid rate of interest be paid as per section 7(3 A) of the ibid Act on the due amount of gratuity as in the instant case no exemption as required under section 5 has been obtained. Accordingly, I order the gratuity claim in favour of the applicant and against the respondent/employer.”’ 5. The appeal filed by the Department against this order stood dismissed vide Annexure P-1 i.e., the impugned order. The Appellate Authority dismissed the appeal by holding that before the retirement of Gorkh Ram who superannuated on attaining the age of superannuation on 31.12.2017, there was no termination of employee employer relationship as the 6 claimant continued to render service to the employer uninterruptedly. Learned Appellate Court also held that the claimant after regularization on 21.10.2009 became a person who held a post under the Central Government or State Government who was thus governed by the Act and Rules providing for payment of gratuity. Learned Appellate Court further held that the gratuity became payable to the claimant within 30 days of its become due i.e. 01.02.2018 and the Controlling Authority on an application made to it on behalf of the aggrieved person rightly issued a certificate for the due amount alongwith compound interest thereupon. 6. Learned Appellate Court thus, disposed of the appeal by returning the following findings: “In view of the facts and circumstances, after affording ample opportunities of being heard during the proceedings to both the parties to the appeal and in view of the reasons mentioned hereinabove, I am constrained to dismiss the appeal. The facts recorded hereinabove clearly envisages and establishes beyond doubt that there is no relevance to go into peripheral details of the appeal in view of the facts and contentions raised in the appeal whatsoever in view of the facts recorded hereinabove. The careful analysis and consideration of the foregoing facts and circumstances and relevant provisions has been done in totality and accordingly, as provided in Section 7(8) of the ibid 7 Act, in view of the above mentioned conclusions and the present appeal is accordingly dismissed after considering all the relevant facts, circumstances and relevant provisions and orders of the Controlling Authority are modified as per contents of the following para; Last wages drawn Rs.20,900/- (As last wages admitted by the employer after the implementation of pay revision /pay commission) Length of service 19 years. Total= last wages drawn x length of service x 15/26= Rs.20,900/-(x)19(x)15/26=Rs.2,29,096/- (Rs. Two Lakh Twenty Nine Thousand Ninety Six Only). However, the Respondent/Claimants has already been paid a sum of Rs.78,872/-on account of regular period gratuity. Thus Rs.1,50,224/- (Rs. 2,29,096/- (-) Rs.78,872/-) along with simple interest @9% per annum from the date of filing the application till the payment is actually made to the Respondent/Claimant by the Appellant/Employer. The appeal is dismissed and order of Controlling Authority passed on 23.05.2022 is accordingly modified. The Appellant/Employer as deposited an amount of Rs.1,37,268/- vide demand draft No. 510370, dated 17.08.2022 as determined and ordered to be paid by the Controlling Authority with the appeal. The amount of Rs1,37,268/- along with the interest accrued will be paid to the Respondent/Claimant as and when application for the same is received and the Appellant/Employer is further directed to pay balance amount of gratuity amounting to Rs.12.956/- (Rs 1,50,224/- (+) Rs.1,37,268/-) to the Respondent/Claimant alongwith simple interest @ 9% from the date of filing application till the payment is actually made. 8 These directions are made on the basis of service details stated by the Appellant/Employer and available in the case file and if some changes have taken/take place on about; service particulars, last wages/salary drawn, payments made on account of payment of ‘Gratuity’ or inadvertent arithmetical calculation errors are identified subsequently, therefore, in such circumstances these directions/orders shall stand modified accordingly. These payments are further subject to provisions contained in Section-2(h)(i) of the Act, if any change in the status of Claimant or family members takes places till the payments are actually made. The appeal is accordingly dismissed. Announced during the proceedings on 7 day of December, 2023 (in the presence of the parties) and detailed orders are given/communicated as follows.” 7. Though, learned Additional Advocate General made an earnest endeavour to demonstrate that the findings returned by the Appellate Authority and Controlling Authority were perverse, but he could demonstrate that the findings were returned by the said authorities were not borne out from the service record of the claimant. 8. As it could not be demonstrated before this Court that the employer was not an “establishment” covered and governed by the provisions of the Payment of Gratuity Act and as the employee was eligible for the grant of gratuity in his 9 capacity having served as a Daily Wager and thereafter as a regular employee of the Department, the grant of gratuity in his favour by the Controlling Authority and the dismissal of the appeal by the Appellate Authority cannot be interfered with. 8. Besides this, during the course of the hearing of this petition, it could not be demonstrated by the petitioner that any procedural infirmity was committed either by the Controlling Authority or by the Appellate Authority while passing the order under challenge. 9. That being so, the issues of fact decided by the Authority and the Appellate Authority being borne out from the record of the case call for no interference, more so, in the light of the fact that the amount of gratuity as has been determined in favour of the employee by the Authority is also not all that huge so as to prompt this Court to show any indulgence in favour of the petitioner. In fact, if one peruses the order passed by the Appellate Authority only an amount of Rs.12,956/- was still payable to the workman alongwith simple interest. 10. In light of the above observations, as this Court does not find any merit in this appeal, the same is dismissed. 10 11. Pending miscellaneous applications, if any, also stand disposed of. (Ajay Mohan Goel) Judge December 18, 2025 (Vinod)