Compassionate appointment and statutory death benefits remain distinct; a family benefit scheme cannot replace or divert them.

Compassionate appointment is described as a social-justice measure intended to give immediate relief to a family facing financial distress after an employee's death, and it is not displaced by a family benefit scheme offering monthly support. The scheme is stated not to be a substitute for compassionate appointment because it cannot provide the same immediate solace and assistance. The text also stresses that gratuity has a statutory character under the Payment of Gratuity Act, 1972, and is payable to the employee's heirs on death, so compulsory diversion of gratuity under the scheme is said to be inconsistent with that mandate. Provident fund is similarly characterised as a statutory benefit meant for direct availability to the family.

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Issues: Whether the introduction of a family benefit scheme could displace or extinguish the right to be considered for compassionate appointment, and whether compulsory diversion of gratuity and provident fund amounts under such a scheme was permissible.

Analysis: Compassionate appointment was treated as a relief measure rooted in social justice and constitutional obligation, especially where the employee's death created immediate financial distress for the family. The family benefit scheme was held not to be equivalent to compassionate appointment, since a monthly payment arrangement could not substitute for the solace and immediate support that a compassionate appointment may provide. The statutory character of gratuity was emphasized: under Section 4 of the Payment of Gratuity Act, 1972, gratuity is payable to the employee or his heirs on death, and a scheme compelling deposit of gratuity with the employer was viewed as inconsistent with that mandate. Provident fund was likewise described as a statutory benefit meant for direct availability to the family, not as a deferred employer-held fund. The previous circular preserving compassionate appointments was also relied upon to support continued consideration of such claims.

Conclusion: The family benefit scheme did not bar compassionate appointment, and the appellants remained entitled to have their cases considered for such appointment.

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