SRINAGAR: The High Court of Jammu Kashmir and Ladakh has granted the Jammu and Kashmir Road Transport Corporation (JKSRTC) the right to pursue a statutory appeal concerning gratuity payments to four retired employees. The court also nullified earlier adverse remarks made by the writ court against the Corporation.
Information was available with The Chenab Times that a Division Bench, comprising Justice Sanjeev Kumar and Justice Sanjay Parihar, delivered this judgment on Letters Patent Appeal (LPA No. 172/2024). The appeal was filed by JKSRTC challenging a judgment dated April 23, 2024, which originated from OWP No. 1741/2018. The reserved judgment was pronounced on May 30.
The Jammu and Kashmir Road Transport Corporation was represented by advocate Shakir Haqani, while advocate Zahoor Jan appeared on behalf of the respondents, who were the retired employees.
The case originated from claims lodged by four former drivers of the Corporation with the Controlling Authority under the Payment of Gratuity Act, 1972. These employees alleged that significant portions of their gratuity dues remained unsettled following their retirement. The retired drivers, identified as Mohd Sidiq Bhat, Abdul Gani Wani, Mohd Ashraf Khan, and Abdul Aziz Dar, sought the release of their outstanding gratuity amounts, including accrued interest.
During proceedings before the Controlling Authority, JKSRTC contended that it was facing severe financial difficulties and had incurred continuous losses, which impeded its ability to meet its financial obligations. However, the employees’ entitlement to gratuity was not contested by the Corporation.
Following its review of the case, the Controlling Authority ordered JKSRTC to disburse the remaining gratuity payments, along with interest at a rate of nine percent per annum from May 1, 2012, until the actual date of payment. When the dues were not settled, the Authority initiated recovery proceedings.
Instead of filing a statutory appeal as provided under Section 7 of the Payment of Gratuity Act, the Corporation opted to submit review petitions directly to the Controlling Authority. These review petitions were dismissed in August 2018, by which time the statutory period for filing appeals had lapsed.
Subsequently, the Corporation approached the High Court through a writ petition, seeking to challenge both the gratuity awards and the ongoing recovery actions. The Corporation’s contention was that the gratuity calculations were erroneously based on Dearness Allowance (DA), while the employees were entitled to benefits under the Cost-of-Living Allowance (COLA) system.
The writ court, however, dismissed the petition and imposed costs of Rs 40,000. The court reasoned that the Corporation had failed to utilize the available statutory remedy and had instead attempted to circumvent the limitation period by pursuing an impermissible review mechanism. The writ court had also commented that the Corporation’s conduct lacked bona fides and appeared to be an effort to impede the proper administration of justice.
Upon hearing the Letters Patent Appeal, the Division Bench acknowledged the established legal principle that writ jurisdiction should generally not be invoked when an effective alternate remedy is available under a statute.
The Bench noted that the question raised by the Corporation regarding the calculation of gratuity, specifically whether DA or COLA should be applied, did not fall under the purview of jurisdiction but was a matter suitable for examination by the appellate authority established under the Payment of Gratuity Act.
Citing a previous High Court judgment in the case of JK State Road Transport Corporation vs Nazir Ahmad Mir, the court affirmed that the Controlling Authority possessed the authority to determine gratuity entitlements under the Act. It further reiterated that disputes concerning the calculation of gratuity were mandated to be resolved through the statutory appellate process.
Concurrently, the Division Bench determined that the writ court should not have included adverse remarks against the Corporation concerning alleged misrepresentation or deliberate misconduct.
The court stated that the mere act of filing review petitions before the Controlling Authority did not inherently signify mala fides or an intention to mislead the court. It suggested that the Corporation might have acted upon incorrect legal advice, possibly without fully understanding that the Controlling Authority lacked the power to review its own decisions.
The Bench further observed that once the writ court had determined that the writ petition was not maintainable due to the existence of an alternate statutory remedy, it should have directed the parties to the appellate forum. It was suggested that making observations that could potentially prejudice either party in future proceedings was inappropriate.
Allowing the appeal, the Division Bench overturned the writ court’s judgment and dismissed the writ petition. The Corporation was, however, granted the liberty to file its statutory appeals before the appropriate appellate authority under the Payment of Gratuity Act.
Additionally, the court ordered that the period during which the Corporation pursued review proceedings and the writ petition would be excluded for the purpose of calculating the limitation period for filing its appeals. The Bench clarified that the observations made in its judgment would not affect the rights of either party before the appellate authority.
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