Holding

Gratuity payable under the Payment of Gratuity Act is immune from attachment, so the attachment order is invalid.

Summary

Md. Safiur Rehman, a dock worker, died leaving a widow and son. The Calcutta Dock Labour Board sought attachment of the gratuity payable to Rehman under its scheme to satisfy a decree against the heirs. The Small Causes Court ordered attachment, overruling the Board’s objection that gratuity was exempt. The High Court upheld the order, holding that Section 13 of the Payment of Gratuity Act did not apply because the gratuity was not payable under the Act and that Section 60(g) of the CPC was not extended to the Presidency Small Causes Court. On appeal, the Supreme Court held that the Act extends to ports, the gratuity fell within its ambit, and Section 13 (with overriding effect of Section 14) gives total immunity from attachment. Consequently, the attachment order was invalid and the appeal was allowed.

Issues considered

Whether gratuity payable to a dock worker under the Calcutta Dock Labour Board is liable to attachment in execution of a decree.
Whether Section 13 of the Payment of Gratuity Act, 1972 provides immunity from attachment to such gratuity.
Whether Section 60(g) of the Code of Civil Procedure, as amended, applies to proceedings before the Presidency Small Causes Court.
Effect of the amendment to Section 13 by Central Act No. 25 of 1984 and of Section 97 of the 1976 amendment on the applicability of the exemption.

Legislation cited

Amending Act of 1976s. 97
Central Act No. 25 of 1984 (amending the Gratuity Act)s. 13
Code of Civil Procedure, 1908s. 60, s. 6(g), s. 8
Indian Ports Act, 1908
Payment of Gratuity Act, 1972s. 1(3), s. 13, s. 14, s. 2(n), s. 4, s. 5

Subjects

gratuityattachmentimmunityPayment of Gratuity ActCode of Civil ProcedureSmall Causes Courtdock workersstatutory exemption

Judgment

826

A CALCUTTA DOCK LABOUR BOARD AND ANR.

v.
SMT. SANDHYA MITRA AND ORS.

B February JI, 1985

[P.N. BHAGWATI AND RANGANTH MisRA, JJ.]

Liability to attachment in executioti of a decree of the Court-Whether
gratuity payable to a lt orkman employed under the Calcutta Dock Labour Board
c is attachable for satisfac1ion of a decree of tfle Court-Payment of Gratuity Act
1972, sections 1(3), 2(n) 4, 5, I 3 and 14 read with Rule 2 of the Gratuity
Ru/.,, f 972 and sections 6(g), 8 and 60 of the Code of Civil Procedure (Act III
of 1908).

Md, Safiur Rehman was a dock worker and gratuity was payable to him
D under one of the three prevailing schemes of the Calcutta Dock Labour Board.
Respondent No. 1 filed a suit before the Court of .Small Causes at Calcutta
asking for recoxery of a sum of money against the widow and son of the
said Md. Safiur Rehman ofter his death and prayed for attachment of the
gratuity payable to the said workman. The Court made an order and called
upon the Board to withhold payment of the amount, whereupon the Board
pointed out to Court that gratuity was not liable to attachment. The Chief
E Judge of the Court of Small Causes examined the objection against attach·
ment and overruled the same. In appeal by the a·ppellants a Division Bench
of the High Court examined the provisions under the Payment of Gratuity
Act and the Code of Civil Procedure, and holding (a) clause (g) of section 6
of the Civil Procedure Code does not cover the gratuity payble by the Board
F to a registered dock worker since subsequent amendment of this clatise have
not been adopted and made applicable by the High Court to Presidency
Small Causes Court; and (b) Rule 9 of the Gratuity Rules which purports
to exempt gr<1.tUiLy from attachment, not having been made by the Central
Government on powers delegated by the Parliament under the Dock Workers
G (R<J!Ulation of Employment) Act, but by the Board on sub-delegation of
powers under the scheme cannot override the legal right of the plaintiff, and <
dismissed the appeal. Hence the·appeal by special leave.

H AIJowing the appeal, the Court,
CALCUTTA LAB. BOAl!.D v. s. MITRA (Ranganath Misra, J.) 827

~ ' HELD : I. The preamble of the Payment of Gratuity Act, 1972 A
clearly indicates the legislative intention that the Act sought to provide a
scheme for payment of gratuity to all employees engaged in, inter-alia port.~
and under th is Act gratuity was payable to workers like Md. Safiur Reb-
man. Io view of the provisions in section 1 (3) of the Act gratuity must be

-
.
taken to be coverdd by section 4 of the Act, in the absence of any notifica-
tiOo contemplated under section 5. Section 14 has also overriding effect and
section 13 g ivcs total immunity to gratuity from attachment. The gratuity
which was payable to him squarcdy came within the purview of the Act
and, therefore, became entitled to immunity under section 18 thereof.
(830D-E]
B

2. The immunity under section 13 of the Payment of Gratuity Act,
itself being adequate the Court applied non-llquet on the two issues~ namely,
(a) consideration of the subsequent event of the amendment of section 13 of c
the Gratuity Act by Central Act 25 of 1984 with effect from July !st, 1914;
and (b) the necessity for remaking of the Calcutta High Court's earlier order
under section 8 of the Civil Procedure Code extending the provisions of
section 60 of the Cocte to the Small Causes Court consequent to section 97
of the Amending Act of 1976. [830H; 83 lA·B]

D.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 34S of
1985.

Appeal by Special leave from the Judgment and Order dated
theSth October, 1983 of the Calcutta High Court at Calcutta in Civil
Order No. 971 of 1983. E

D. N. Mukherjee for the Appellants.

Mahabir Singh for the Respondents.
The Judgment of the Court was delivered by
F
RANGANATH MISRA, J. Special leave granted.

The short question which falls for decision in this appeal is
whether gratuity payable lo a workman employed under the Calcutta
i Dock Labour Board (hereinafter referred to as 'Board') is attachable
for satisfaction of a decree of the Court. Md. Safiur Rehman was a
dock worker and gratuity was payable to him under one of the three G

> prevailing schemes of the Board. Respondent I filed a suit before
the Court of Small Causes at Calcutta asking for recovery of a sum
of money against the widow and son of the said Md. Safiur Rehman
after his death and prayed for attachment of the gratuity payable to
the said workman. The Court made an order and cal!ed upon the H
(1985) :1 S.C.R·

A
.,,.I
Board 'to witllhold paynieht of the amount whereupon the Board
pointed out to the Court that gratuity was not liable to aitachiitent. )
On receipt of such intimation, the Court, made an order requiring
the Board to show cause as to why it may not be proceeded against

B
for disobedience of the Court's direction. The Chief Judge of the
Court of small Causes examined the objection against attachment
and overruled the same. Against the rejection of ~he objection the
appellants moved the High Court at Calcutta and contended that
the gratility payable to the workman was not liable to attachment.
- •
A Division Bench of the High Court examined the tenability of
the contention and came to the following conclusion:
c
"On a careful consideration of the legal position we,
however, find that the learned Chief Judge is right in his
conclusion. Pfointiff has a legal right to attach any debt
payable to his debtor or legal representative. This right,
however, is always subject to exceptions made by any
n· statutory provision. Section 13 of the Payment of Gratuity
Act no doubt bars attachment but that only is in respect
of gratuity payable under that Act. The gratuity now under
attachment is payable not under the Act. Section 60 of the
C0de of Civil Procedure as amended may bar attachment
E of gratuity as now under consideration. But that section
as it now stands had not been made applicable to Presi·
dency Small Causes Court. Under Section 8 of the Code,
the Hig!t Court adopted certain provisions of the Code
including section 60 as amended upto 1965 and made them
applicable to Presidency Small Causes Court. Section 6,
F clause (g) so adopted reads as follows ~

(g). Stipends and gratuities allowed to pensioners
of the Government or payable out of any service, family
pension fund notified in Official Gazette by the Central
Government or the State Government in this behalf and
p0litica! pensioners. r
G
'lb.is :ciause'{does not cover the gratuity payable by
the Board to a registered dock worker and the subsequent
amendment of this clause not having been adopted and
mlitle applicable by tho High Court to Presidency Small
ca<ases Court, the learned Chief Judge is right in his
•tlaioii.
•

t'.:ALtUTTA i.Ail. ilOARi> '" s. MITRA (Ri1irja11arh Misra, j,) 82!>
I
>-
Next reliiince is placed on Rule 9 of the Gratuity
Rules which no doubt purports to exempt gratuity from
attachment. But these rules not having been made by the
Central Government on powers delegated by the Parlia-

-
•
ment under tlie Dock Workers (Regulation of Employment)
Act, but by the Board on sub-delegation of powers under
the scheme. the same in our view cannot override the legal
right of the plllintiff."
B

Mr. Mnkherjce appearing for the appellants maintained that
the view taken both by the Chief Judge of the Small Causes Court
as also the Division Bench of the High Court is contrary to law c
and, therefore, C'a.nnot be sustained. The respondents had filed an
appcarartde ihrough counsel. but no one participated in the
hearing.

Section I (3) of the Payment of Gratuity Act (39 of 1972)
('Act' for short), provides that the Act shall extend to ports. 'Port'
has been defined in s. 2 (n) of the Act. There ca.n be no dispute
th\lt tile Cafctltia Pott is covered by the Indian Ports Act, 1908.
It is true that uiltfer one of the three schemes framed by the
Calcutta Dock Labour Board gratuity was payable to Md. Safiur
Rehl:ri11n, bilt su'c\h gratuity must be taktn to be covered bys. 4 of
the Abt, in tlic absetice of any notification contemplated under s. 5.
Seetion 5 atithorises the appropriate Government by notification E
and sutiject t'o such conditions as may be specified in that noti.
fieiltiorl to e:tempt, fiite'r a/ta any port to which the Act applies,
from the operation of the provisions of the Act, if in the opinion
of the appropriate Government the employees in the port are in
rei:el\lt of gra~uity i>i' pensionary benefit not less favourable than
the b\!n'efits conferred under the Act. Neither the Chief Judge nor
F
tliil High Court has found that there has been a notification as
coriieittplated under s. 5 of the Act in this case. It had also not
been contended at arly stage by the respondents that such a noti-
ficatltin had .been 'made.

Referencl: may now be made to ss. 13 and 14 of the Act G
wldch are very relevant.

"1.3. Protection of gratufty:-'No gratuity payable
under this Act shall· be liable to attachment in executfoi:t
of any decree or order of any civil, revenue or crimihal
court." H'
8~() (1985] 2 s.c.R.

A I
14. Act to override other enactments, etc:-The -f
provisicns of this Act or any rule made thereunder shall
J
have effect notwithstanding anything inconsistent there-
with contained in any enactment other than this Act or in
any instrument or contract having effect by virtue of any
B enactment other than this Act."

We may point out that by Central Act No. 25 of 1984 s. 13
has been amended with effect from July I, 1984, and the amended
-
section reads thus :-

c "No gratuity payable under this Act and no gratuity
payable to an employee employed in any establishment,
factory, mine, oilfield, plantation, port, railway company
or shop exempted under section 5 shall be liable to
attachment in execurion of any decree or order of any
civil, revenue, or criminal court." ·
D
In the absence of any notification within the meaning of s. 5 of
the Act the amendment is not relevant for consideration. Section
14 has overriding effect and s. 13 gives total immunity to gratuity
from attachment. The preamble of the Act ~!early indicates the
legislative intention that the Act sought to provide a scheme for
E payment of gratuity to all employees engaged in, inter alia, ports
and under this Act gratuity was payable to workers like Md. Safiur
Rehman. The gratuity which was payable to him squarely came
within the purview of the Act and, therefore, become entitled to
immunlty under s. 13 thereof.

F In s. 60 of the Code of Civil Procedure provision for exemp-
tion from attachment has been made and a detailed list has been
provided in sub·s. (!)thereof in clauses (a) to (p). Clause (g) there-
of exempts stipeods and gratuities allowed to pension;rs of the
Government or of a local authority or of any other employer from
attachment. It may be pointed out that the words "local authority"
or "other employer" were inserted into the statute by the amending
G
Act of 1976 with effect from February 1, 1977. The Chief Judge as
also the High Court relying on the provisions of section 8 of Co.de
took the view that unless extended by the High Court of Calcutta,
,..
the protection of s. 60 was not available in regard to proceedings
before the Pregidency Small Causes Court at Calcutta. It appears
H that the Calcutta High Court in exercise of power under .s. 8 of
CALCUTIA LAB. BOARD v. s. MITRA (Ranganath Misra, J,) 831

the Code had extended the provisions of the s. 60 of the Code but A
i the High Court seems to have wrongly taken the view that the
effect of s. 97 of the Amending Act of 1976 was that the notification
of the High Court was no more effective unless re-made. It is wholly
unnecessary for the disposal of this appeal to examine that aspect
as in our view the immunity under s. 13 of the Act is adequate to
accept the appeal and find against the respondent. We, therefore. B
allow the appeal and hold that the Chief Judge as also the High
Court were in error in taking the view that gratuity payable to Md.
Safiur Rehman was liable to attachment. Parties are directed to
bear their own costs.
c

S. R. Appeal allowed.

'