"a. That while working as joint custodian of the Branch, you surreptitiously removed the gold ornaments pledged by one Mr. Manoj V.Jose and re-pledged the same with private financiers for raising funds for your personal gains as detailed below:

b. That while holding charge of the branch, you yourself sanctioned and availed a Gold Loan in your name under G.L. No.259 dated 15-11-1997 for Rs.1500/- abusing your powers contrary to the extant instructions with regard to sanctioning of such loans. 

c. That you stealthily removed the gold loan pledge forms in respect of the gold loans, the gold packets of which were earlier removed by you, with ulterior motive of non-detection of your act at the time of surprise inspection on 11-12-1997. 

d. That you willfully violated the extent instructions of Central Office regarding joint custody. 

e. That you abused the opportunity given to you to act as joint custodian of the branch for your illegal personal gains. 

f. That you did not comply with the instructions of your controlling authority in the matter of tallying of S.B. and Dhanachakra Schedules at the Branch. 

g. That your above acts are highly dishonest, very much prejudicial, seriously detrimental to the interests of the Bank, subversive of its discipline and also against the trust and confidence reposed on you. 

h. That your above acts have adversely affected the image and reputation of the Bank. 

i. That you have committed the above acts inspite of punishments inflicted on you for some other misconducts earlier and the opportunity given by the Bank for better conduct."

a) Call for the records leading to Ext.P6 and issue a writ of certiorari or any other appropriate writ, order or direction quashing the same. 

b) declare that the forfeiture of gratuity by the petitioner is legal and is in accordance with the provisions contained in the Payment of Gratuity Act.

"4. Payment of gratuity. - (1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years, - 

(a) on his superannuation, or 

(b) on his retirement or resignation, or 

(c) on his death or disablement due to accident or disease: 

Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement: 

Provided further that in the case of death of the employee, gratuity payable to him shall be paid to his nominee or, if no nomination has been made, to his heirs, and where any such nominees or heirs is a minor, the share of such minor, shall be deposited with the controlling authority who shall invest the same for the benefit of such minor in such bank or other financial institution, as may be prescribed, until such minor attains majority. 

Explanation. - For the purposes of this section, disablement means such disablement as incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement."

"4(6) Notwithstanding anything contained in sub-section (1),— 

(a) the gratuity of an employee, whose services have been terminated for any act, wilful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be forfeited to the extent of the damage or loss so caused; 

(b) the gratuity payable to an employee may be wholly or partially forfeited- 

(i) if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or 

(ii) if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment."

"14. Before concluding, it is necessary to observe that though complying with rules of natural justice was unnecessary, for forfeiting Gratuity under Sec. 4(6)(b) of the Act as it stood. When the decision was taken by the appellant as it provided that the gratuity shall stand wholly forfeited under circumstances specified in cls.(i) ad (ii) , the position has since changed in view of the amendment of Sec. 4(6)(b)(ii) of the Act with effect from 01-07-1984. After the amendment, it reads thus: 

"4(6) Notwithstanding anything contained 

in sub-sec. (1) -- 

xxx xxx xxx 

(b) the gratuity payable to an employee may be wholly or partially forfeited - 

(i) if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or 

(ii) if the services of such employee have been terminated for any act which constitutes n offence involving moral turpitude, provided that such offence is committed by him in the course of his employment." 

(Underlined by us)  

"8. The object of having gratuity scheme is to provide a retiring benefit to the workman who has rendered long and unblemished service to the employer and thereby contributed to the prosperity of the employer; but it is not correct to say that any misconduct, however grave, may not be visited with the forfeiture of gratuity in view of Sec. 4(6) of the Act as rightly pointed out by the learned counsel for the appellant. In other words, if the workman is guilty of serious misconduct, then the gratuity can be forfeited in its entirety vide Management of Tournamulla Estate Vs. Their Workmen, AIR 1973 SC 2344 : (1973) 2 SCC 502 : 1973 II LLJ 241. It is also a settled law that a bare looking at Section 4(6)(a) shows that the right of the employer to forfeit the amount of earned gratuity sine qua non to the extent of damage or loss so caused but such a power in our considered opinion is not automatic. If the employer fails to prove before the Controlling Authority which is functioning under the Act the extent of damage or loss so caused by the employee because of his act of alleged major misconduct, the right to forfeit the gratuity under Sec. 4(6)(a) is not available to the employer. In other words, before forfeiting the gratuity amount, the employer should afford an opportunity to the employee to the extent why his amount of gratuity be not forfeited, which leads to the conclusion that if no material is brought on record to show that the service of the employee was terminated for any act, willful omission or negligence causing damage, loss or destruction of the employer's property, and if the extent of such damage is not quantified, the provisions of Sec. 4(6)(a) do not come into operation. The statutory provision for forfeiture of gratuity therefore, must be construed strictly and the employer, in the eye of law, has to prove before the Controlling Authority, the extent of damages or loss so caused by the employee, because of his act of alleged misconduct, or/and otherwise the employer is not entitled to invoke Sec. 4(6)(a). Such proof presupposes a statutory requirement of giving an opportunity to the employee before the Controlling Authority. In short, the decision to forfeit can be taken only after assessing the loss, which can be arrived at only after affording an opportunity to the employee concerned to be heard, which is mandatory before taking such a decision. It is only under such context and background of the case and well-settled principle laid down on the point, the learned single Judge had, in our considered opinion, rightly directed: 

"(b) The respondent-Bank shall pay the gratuity, leave encashment and their contribution towards the Provident Fund with interest under the regulation within eight weeks from the date of receipt of this order. 

(c) It is clarified that it is only the provident fund, which will carry interest as regulated by the Bank. 

(d) The petitioner shall execute an indemnity bond for the said amount i.e., the amount payable by the Bank towards their contribution of the Provident Fund." 

safeguarding the interest of the parties. 

9. Therefore, having no reason to interfere with the order of the learned single Judge, the writ appeal is dismissed."

"4. The Payment of Gratuity Act, 1972, gives a statutory right to an employee for payment of gratuity on his superannuation, retirement or resignation, or on his death or disablement due to accident or disease. Sec. 4 (6)(a) of the Act provides that the gratuity of an employee, whose services have been terminated for any act, wilful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be forfeited to the extent of the damage or loss so caused. Sub­ sec. 6(b), provides that the gratuity payable to an employee may be wholly or partially forfeited: (i) if the services of such employee have been terminated for his riotous or disorderly conduct, or any other act of violence on his part or, (ii) if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment. 

5. The scheme of the Act and the provisions of Sec. 4(6)(a) and (b) shows that for depriving an employee his statutory right to receive gratuity, an order must be passed forfeiting gratuity, and conscious decision to be taken with regard to reasons specified in sub ­sec. (a) and to damage or loss so caused. The sub-section (b) after its amendment by Act No.26 of 1984 (with effect from February 11, 1981) to the effect that gratuity must be wholly or in part forfeited, gives discretion to the employer and thus postulates application of mind and recording of reasons. 

6. In the present case there is no averment that any express order was passed by the employer forfeiting petitioner's right to receive gratuity. In Remington Rand of India Ltd. Vs. The Workmen, AIR 1970 SC 1421 : (1969) 3 SCC 913, the Supreme Court considered the qualifying period for payment of gratuity, and the consequences of payment of gratuity on the termination of services for misconduct. It was held that gratuity is paid to ensure good conduct throughout the period that the workman serves his employer is an accepted proposition. The clause as to misconduct covers the act which may vary in degree of gravity, nature and its impact on the discipline and the working of the concern. All these acts may not result in loss capable to being calculated in terms of money. There may be an action which may forthwith disentitle the workman from retaining his employment and justifying his dismissal. It appears that after this pronouncement, the Act was amended and that a provision was made under Sec. 4(6)(b) for forfeiture of gratuity either wholly or partially. The discretion given to the employer must be based upon the material and the reasons recorded, after serving principle of natural justice and these conditions postulate an order to be passed by the employer. The termination of services of an employee on the grounds contemplated under Sec. 4(6)(a) and (b), by Itself does not entitle the employer to forfeit gratuity payable to an employee. The right of an employer to terminate the services of an employee under the Certified Standing Orders, or Service Conditions on any such act given in Sec. 4(6)(a) and (b), of the Act of 1972, is circumscribed and restricted to holding a just and fair domestic enquiry serving principles of natural justice, which may be examined and justified in industrial adjudication, in which the proportionality of punishment may be examined under Sec. 11-A of the Industrial Disputes Act, 1947. The Industrial adjudicature may find the domestic enquiry and punishment to be just, fair and proper, but these findings by themselves do not serve the requirements of Sec. 4(6)(a) and (b) of the Payment of Gratuity Act, 1972. The right to receive gratuity is a statutory right. It is not subservient to the common law rights of the employer to terminate the services of an employee. In order to forfeit the statutory right of gratuity, qualified by expression 'to the extent of damage or loss so caused in sub-section (6) (b), the quantum of forfeiture has to be determined, and thus it requires an order, which can only be passed after giving opportunity to one employee. When the forfeiture, even if by an express and reasoned order is challenged before the Controlling Authority under the Act, the employer must satisfy the authority in proceedings under Sec. 7(4) of the Act, with the justification of forfeiture."