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Issues: (i) whether the Irrigation and Public Health Department was an establishment covered by the Payment of Gratuity Act, 1972; (ii) whether the workman was entitled to gratuity for his daily wage period under the Payment of Gratuity Act, 1972 and for the regularised period under the CCS (Pension) Rules, 1972, with interest.
Issue (i): Whether the Irrigation and Public Health Department was an establishment covered by the Payment of Gratuity Act, 1972.
Analysis: The Act applies to establishments within the scope of Section 1(3). The Department was found to be engaged in the infrastructure for water supply, including construction, maintenance, and operation of water pumps, and thus answered the description of an establishment covered by the statute. The interpretation adopted was consistent with the liberal and welfare-oriented approach applied to gratuity legislation.
Conclusion: The Department was covered by the Payment of Gratuity Act, 1972.
Issue (ii): Whether the workman was entitled to gratuity for his daily wage period under the Payment of Gratuity Act, 1972 and for the regularised period under the CCS (Pension) Rules, 1972, with interest.
Analysis: The workman had rendered service in two distinct capacities, first as a daily wager and later as a regular employee. A daily wager who is not appointed against a sanctioned post was not treated as holding a post under the Government so as to be excluded from the definition of employee. The Court held that the two regimes could operate in their respective spheres: gratuity for the daily wage period under the Payment of Gratuity Act, 1972, and gratuity for the regular service period under the CCS (Pension) Rules, 1972. Delay in payment of gratuity attracted statutory interest.
Conclusion: The workman was entitled to gratuity for both periods under the respective legal regimes, together with interest.
Final Conclusion: The challenge failed in substance, and the workman's entitlement to gratuity was upheld on a bifurcated basis for the two periods of service.
Ratio Decidendi: Where service is rendered in distinct spells under different legal statuses, gratuity may be computed separately under the applicable governing regime for each spell, and a welfare statute governing gratuity must be construed liberally with statutory interest attaching to delayed payment.
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