[Presidents Act 7 of 1971] [28th August, 1971] An Act to provide for a uniform
scheme of retirement benefit for employees engaged in factories, plantations or
shops and establishments and for matters connected therewith or incidental
thereto. In exercise of the powers
conferred by Section 3 of the West Bengal State Legislature (Delegation of
Powers) Act, 1971 (1 of 1971) the President is pleased to enact as follows:— REASONS FOR THE ENACTMENT On the 3rd June, 1971, the
Governor of West Bengal promulgated an Ordinance entitled the West Bengal
Employees' Payment of Compulsory Gratuity Ordinance, 1971. The said Ordinance
provides for payment of gratuity to all employees employed in West Bengal in
establishments governed by the Factories Act, 1948, Plantations Labour Act,
1951 or the West Bengal Shops and Establishments Act, 1963. Under the
Ordinance, gratuity is payable to every employee who has rendered not less than
five years of continuous service on his superannuation, retirement or
resignation or death or total, disablement due to accident or disease. The
gratuity is payable at the rate of fifteen days' wages for every completed year
of service subject to a maximum of fifteen months' wages. The Ordinance,
however, empowers the State Government to exempt any factory, plantation or
establishment from the provisions of the Ordinance if in the opinion of that
Government the employees or any class of employees in such factory, plantation
or establishment are in receipt of benefits better than the benefits conferred
under the Ordinance. 2. The present enactment seeks to
replace the said Ordinance with certain modifications mentioned below:— (i) the operation of the
enactment has been limited in relation to shops or establishments as defined in
the West Bengal Shops and Establishments Act, 1963, in which ten or more
persons are employed, (ii) the benefit of gratuity
under the proposed enactment has been restricted to those employees whose wages
do not exceed seven hundred and fifty, rupees per mensem or who do not hold a
civil post under the Central or State Government, (iii) the age of superannuation
of an employee for the purpose of entitlement to gratuity has been fixed, as
fifty-eight years in cases where the age of superannuation is not stipulated in
the contract or conditions of service of that employee or where no such
contract subsists or no conditions of service have been specified, (iv) wages have been so defined
as to include dearness allowance but not house rent allowance, (v) the qualifying period of five
years of continuous service for entitlement to gratuity will not be applicable
in the case of death or total disablement due to accident or disease of the
employee, (vi) an employee shall be
disentitled to gratuity if his employment is terminated for gross misconduct, (vii) a factory, plantation, shop
or establishment would now be eligible for exemption if the employees therein
are in receipt of benefits which are not less favourable than those provided
under the present enactment. 3. The Committee constituted
under the proviso to sub-section (2) of Section 3 of the West Bengal State
Legislature (Delegation of Powers) Act, 1971 (01 of 1971), has been consulted
before enactment of this measure as a President's Act. (1)
This Act may be called
the West Bengal Employees Payment of Compulsory Gratuity Act, 1971. (2)
It extends to the whole of the
State of West Bengal. (3)
It shall apply to— (a)
any factory as defined in clause
(m) of Section 2 of the Factories Act, 1948 (63 of 1948); (b)
any plantation as defined in
clause (f) of Section 2 of the Plantations Labour Act, 1951 (69 of 1951); (c)
any shop or establishment as
defined in the West Bengal Shops and Establishments Act, 1963 in which ten or
move persons are employed. In this Act, unless the context
otherwise requires,— (a) “Collector” means the Collector of the district in which the
factory, plantation, shop or establishment is situated and in the case of a
factory, plantation, shop or establishment situated in Calcutta means the
Collector of the district of 24-Parganis. Explanation.—For the purposes of
this Act, “Calcutta” means the town of Calcutta as defined in the Calcutta
Police Act, 1866, and includes the suburbs of the town of Calcutta as defined
by notification made under Section 1 of the Calcutta Suburban Police Act, 1866
(Bengal Act IV of 1866); (b)
“completed year of service” means
continuous service for one year; (c)
“continuous service” means
uninterrupted service and includes service which is interrupted by sickness,
accident, leave, strike which is not illegal or a lock out or cessation of work
not due to any fault of the employee concerned; (d)
“controlling authority” means an
authority appointed, by the State Government under Section 3; (e)
“employee” means any person
(other than an apprentice) employed on wages, not exceeding rupees seven
hundred and fifty per mensem, in any factory, plantation, shop or establishment
to do any skilled, semi-skilled or unskilled manual, supervisory, technical or
clerical work, whether the terms of such employment are express or implied, but
does not include any such person who is employed in a managerial or
administrative capacity, or who holds a civil post under the Central, or State
Government, or who is subject to the Air Force Act, 1950, (45 of 1950) the Army
Act, 1950 (46 of 1950), or the Navy Act, 1957 (62 of 1957); (f)
“employer” means— (i)
in relation to any factory,
plantation, shop or establishment which is owned or managed by the Central or
the State Government, a person or authority appointed by such Government for
the supervision and control of employees or where no person or authority has
been so appointed, the head of the Ministry or the Department concerned; (ii)
in relation to any factory,
plantation, shop or establishment owned or managed by any local authority, the
person appointed by such authority for the supervision and control of employees
or where no person has been so appointed, the chief executive officer of the
local authority; (iii)
in any other case, the person,
who or the authority which has the ultimate control over the affairs of the
factory, plantation, shop or establishment and where the said affairs are
entrusted to any other person whether called a manager, managing director
managing agent, or by any other name, such person; (g)
“family”, in relation to an
employee, shall be deemed to consist of— (i)
in the case of a male employee,
himself, his wife, his children, whether married or unmarried, his dependent
parents and the window and children (ii)
in the case of a female employee,
herself, her husband, her children, whether married or unmarried, her dependent
parents and the dependent parents of her husband and the widow and children of
her predeceased son, if any: Provided that if a female
employee, by a notice in writing to the controlling authority, expresses her
desire to exclude her husband from her family, the husband and his dependent
parents shall no longer be deemed, for the purposes of this Act, to be included
in the family of such female employee unless the said notice is subsequently
withdrawn by such female employee. Explanation.—In either of the
above two cases if the child of an employee has been adopted by another person
and if under the personal law of the adopter, adoption is legally recognized,
such child shall be considered as excluded from the family of the employee; (h)
“notification” means a
notification published in the Official Gazette; (i)
“prescribed” means prescribed by
rules made under this Act; (j)
“retirement” means termination of
the service of an employee for any cause, but does not include superannuation; (k)
“superannuation” means the
termination of the service of an employee by thee employer,— (i)
when the employee attains such
age as is fixed in the contract or conditions of service as the age of
superannuation; and (ii)
in any other case, when the
employee attains the age of fifty-eight years; (l)
“wages” means all emoluments
which are earned by an employee while on duty or on leave in accordance with
the terms and conditions of his employment and which are paid or are payable to
him in cash and includes dearness allowance but does not include any bonus,
commission, house rent allowance, overtime wages and night allowance: The State Government may, by
notification, appoint any officer, not below the rank of a Deputy Labour
Commissioner, to be a who shall be responsible for the administration of this
Act and different controlling authorities may be appointed for different areas. (1)
Gratuity shall be payable to an
employee— (a)
on his superannuation, (b)
on his retirement or resignation, (c)
on his death or total disablement
due to accident or disease, after completion of not less than five years of
continuous service: Provided that the completion of
continuous service of five Explanation.—For the purposes of
this section, total disablement means such disablement as permanently
incapacitates an employee for all work which he was capable of performing
before the accident or disease resulting in such disablement. (2) Notwithstanding anything contained in sub-section (1), no gratuity
shall be payable to an employee whose employment has been terminated for his
gross misconduct. Explanation.—For the purpose of
sub-section (1), “gross misconduct” means,— (a)
any act or wilful omission on the
part of the employee resulting in loss or damage to or destruction of, property
belonging to or owned by the employer; or (b)
any serious act of violence on
the part of the employee; or (c)
any act on the part of the
employee which constitutes an offence involving moral turpitude punishable
under the Indian Penal Code (46 of 1860). (3)
In the case of death of an
employee, the gratuity shall be payable to the nominee of the employee or in
the absence of a nominee to his heirs. (4)
The employer shall pay gratuity
to an employee at the rate of fifteen days' wages based on the rate of wages
last drawn by the employee concerned, for every completed year of service or
part thereof in excess of six months: Provided that the amount of
gratuity payable to an employee shall not exceed fifteen months' wages: Provided further that nothing in
this section shall affect the right to any better terms of gratuity or
retirement benefits under any award or agreement or contract with the employer. The State Government may, by
notification and subject to such conditions as may be specified in the
notification, exempt any factory. plantation, shop or establishment to which this
Act applies from the operation of the provisions of this Act if, in the opinion
of the State Government, the employees in such factory. plantation, shop or
establishment are in receipt of benefits not less favourable than the benefits
conferred under this Act. (1)
Each employee who has completed
one year of service shall make within such time as may be prescribed,
nomination for the purpose of sub-section (3) of Section 4 in such form and in
such manner as may be prescribed. (2)
An employee may in his nomination
distribute, the amount of gratuity payable to him under this Act amongst more
than one nominee. (3)
If an employee has a family at
the time of making a nomination, the nomination shall be in favour of one or
more members belonging to his family, and any nomination made by such employee
in favour of a person not belonging to his family shall be void. (4)
If at the time of making a
nomination the employee ks no family the nomination may be in favour of any
person or per sons but if the employee subsequently acquires a family, such
nomination shall forthwith become invalid and the employee shall make within
such time as may be prescribed, a fresh nomination in favour of one or More
members belonging to his family. (5)
A nomination may, subject to the
provisions of sub-sections (3) and (4), be modified by an employee at any time,
after giving a written notice of his intention to do so in such form and in
such manner as may be prescribed. (6)
If a nominee predeceases the
employee, the interest of the nominee shall revert to the employee who shall
make a fresh nomination in respect of such interest. (1)
Any employee who is eligible for
payment of gratuity on superannuation under this Act or any person autnorised
in writing to act on his behalf shall send a written application to the
employer within such time and in such form as may be prescribed. (2)
As soon as the amount of gratuity
becomes payable, the employer shall give notice in writing to the person to
whom the gratuity is payable and to the controlling authority specifying the
amount of gratuity and the employer shall arrange to pay such amount within
such time as may be prescribed to that person. (3)
If there is any dispute as, to
the amount of gratuity payable or as to the admissibility of the claim, the
controlling authority, on an application made to it in this behalf in such
manner as may be prescribed, shall determine the amount after due inquiry and
if any amount is found to be due, the controlling officer shall direct the
employer to pay the same to the person referred to in sub-section (2) within
such time as may be prescribed. (4)
No order shall be made under
sub-section (3) unless the parties to the dispute have been given a reasonable
opportunity of being heard. (5)
For the purpose of conducting an
inquiry under sub-section (3), the controlling authority shall have the same
powers as are vested in a court while trying a suit under the Code of Civil
Procedure, 1908 (5 of 1908), in respect of the following matters, namely:— (a)
enforcing the attendance of any
person or examining him on oath; (b)
requiring the discovery and
production of documents; (c)
receiving evidence on affidavits; (d)
issuing commissions for the
examination of witnesses. (6)
Any inquiry under this section
shall be a judicial proceeding within the meaning of Sections 193 and 228, and
for the purpose of Section 196, of the Indian Penal Code (45 of 1860). (7)
Any person aggrieved by an order
under sub-section (3) may prefer an appeal, to the State Government or such
other authority as may be specified by the State Government in this behalf,
within sixty days from the date of the receipt of the order and the decision of
the State Government or other authority on such appeal shall be final (45 of
1860). If the amount of gratuity under
this Act is not paid by the employer, within the time prescribed to the person
entitled thereto, the controlling authority shall, on an application made to it
in this behalf by the aggrieved person, issue a certificate for that amount to
the Collector who shall recover the same as arrears of land revenue under the
provisions of the Bengal Public Demands Recovery Act, 1913 (Bengal Act III of
1913), and pay the same to the person entitled thereto. (1)
Whoever, for the purpose of
avoiding any payment to be made by himself under this Act or of enabling any
other person to avoid such payment, knowingly makes or causes to be made any
false statement or false representation shall be punishable with imprisonment
for a term which may extend to six months, or with fine which may extend to one
thousand rupees, or with both. (2)
An employer who contravenes, or
makes default in complying with any of the provisions of this Act or any rule
made thereunder shall be punishable with imprisonment for a term which may
extend to three months, or with fine which may extend to one thousand rupees,
or with both. (1)
No court shall take cognizance of
any offence punishable under this Act save on a complaint made by or under the
authority of the State Government. (2)
No court inferior to that of a
Presidency Magistrate or a Magistrate of the first class shall try any offence
punishable under this Act. No suit or other legal proceeding
shall lie against the controlling authority or any other person in respect of
any thing which is in good faith done or intended to be done under this Act or
any rules made thereunder. (1)
The State Government may, by
notification, make rules rules for the purpose of carrying into effect the
provisions of this Act. (2)
Every rule made under this Act
shall be laid; as soon as may be after it is made, before the Legislative Assembly
while it is in session for a total period of fourteen days which may be
comprised in one session or in two successive sessions, and, if before the
expiry of the session in which it is so laid or the session immediately
following, the Legislative Assembly makes any modification in the rule, or
decides that the rule shall not be made, the rule shall thereafter have effect
only in such modified form or be of no effect, as the case may be, so, however,
that any such modification or annulment shall be without prejudice to the
validity of anything previously done under that rule. (1)
The West Bengal Employees Payment
of Compulsory Gratuity Ordinance, 1971 (West Bengal Ordinance I of 1971), is
hereby repealed. (2)
Notwithstanding such repeal,
anything done or any action taken under the said Ordinance shall be deemed to
have been done or taken under this Act as if this Act hart come into force on
the 14th day of June, 1971. [1] Enacted by the
President in the Twenty-second Year of the Republic of India, dated 28th
August, 1971.West Bengal Employees'
Payment of Compulsory Gratuity Act, 1971[1]
Section
1. Short title extent and application
Section
2. Definitions
Section
3. Controlling authority
Section
4. Payment of Gratuity
Section
5. Power to exempt
Section
6. Nomination
Section
7. Determination of the amount of gratuity
Section
8. Recovery of gratuity
Section
9. Penalties
Section
10. Cognizance of offences
Section
11. Protection for acts done in good faith
Section
12. Power to make rules
Section
13. Repeal and Savings