Case Note & Summary
The dispute arose when a former employee of Shri Mookambika Temple, Kollur, claimed gratuity under the Payment of Gratuity Act, 1972 after his superannuation. The temple resisted, asserting that the Act did not apply to it as a temple governed by the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997. The employee had been initially relieved from duties on 29.11.2005, but after a legal challenge, he was finally relieved effective 31.12.2008. He then filed a claim before the Controlling Authority under the Payment of Gratuity Act, which by order dated 30.03.2011 directed the temple to pay Rs. 2,91,351 with interest. The temple's appeal to the Appellate Authority was dismissed on 26.04.2012. Aggrieved, the temple filed a writ petition (W.P. No. 54267/2013) before the High Court. A Single Judge dismissed the petition on 18.02.2014, holding that the issue was covered by a Division Bench decision in Management of Venkataramana Swamy Temple, which had held that a temple clerk is entitled to gratuity. The temple preferred a writ appeal, which was delayed by 445 days; the delay was condoned. During hearing of the appeal, the appellant's counsel argued that the prior decisions, including an Orissa High Court ruling, did not adequately consider the specific definitions under the Karnataka Shops and Commercial Establishments Act, 1961 and the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997. Reliance was placed on judgments from Kerala and Madras High Courts holding the Payment of Gratuity Act inapplicable to temple employees, and on the principle that special laws prevail over general laws. The Division Bench found that arguable questions of law arose, particularly whether a temple qualifies as a 'commercial establishment' under the Karnataka Shops and Commercial Establishments Act, 1961, thereby making it an 'establishment' for the purpose of Section 1(3)(b) of the Payment of Gratuity Act, 1972. The court also questioned the correctness of the Division Bench's earlier decision in Venkataramana Swamy Temple. Consequently, by order dated 20.07.2018, the Division Bench referred the two substantial questions of law to a Full Bench. The Full Bench was constituted and heard arguments, and the matter was reserved for orders. The judgment text provided ends with the recitation of the reference order and does not contain the Full Bench's final determination on the questions.
Headnote
A) Labour Law - Payment of Gratuity Act, 1972 - Applicability to Temples - Section 1(3)(b) Payment of Gratuity Act, 1972; Section 2(e) Karnataka Shops and Commercial Establishments Act, 1961; Section 2(27) Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997 - The question arose whether a temple, defined under the Act of 1997, is a 'commercial establishment' within the meaning of the Act of 1961, so as to be an 'establishment' for purposes of the Payment of Gratuity Act - The Division Bench found that it is seriously questionable whether a temple falls within the concept of commercial establishment, and that the issue had not been fully considered in prior decisions - Held that the matter raises arguable questions of law, necessitating reference to a Full Bench for determination (Paras 1, 10, 17).
B) Precedent - Division Bench Decision in Management of Venkataramana Swamy Temple case - Correctness under Karnataka Law - Payment of Gratuity Act, 1972; Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997 - The court doubted the correctness of the Division Bench's decision that a temple clerk is entitled to gratuity under the Payment of Gratuity Act, 1972, because the question of whether a temple is an 'establishment' under the relevant state law was not adequately examined - Reference made to Full Bench to examine the conformity of that decision with applicable provisions (Paras 1, 10).
Issue of Consideration
(i) Whether the appellant, being a 'temple' as defined in clause (27) of Section 2 of the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997, answers to the description of 'commercial establishment' within the meaning of clause (e) of Section 2 of the Karnataka Shops and Commercial Establishments Act, 1961 and thereby, is an 'establishment' within the meaning of the said Act of 1961; and hence, the Payment of Gratuity Act, 1972 is inapplicable to it by virtue of clause (b) of sub-section (3) of Section 1 thereof? (ii) Whether the law declared by the Division Bench of this Court in the case of Management of Venkataramana Swamy Temple (supra), that a clerk in a temple is entitled to claim the benefit of gratuity on attaining the age of superannuation under the Payment of Gratuity Act, 1972, stands in conformity with the provisions of law applicable in the State of Karnataka?
Final Decision
The Division Bench, finding that arguable questions of law arise, referred two questions to a Full Bench: (i) Whether a temple under the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997 is a 'commercial establishment' under the Karnataka Shops and Commercial Establishments Act, 1961, making the Payment of Gratuity Act, 1972 applicable; (ii) Whether the Division Bench's decision in Management of Venkataramana Swamy Temple is correct. The Full Bench was constituted and the matter reserved for judgment; the provided text does not include the Full Bench's final decision.
Law Points
- Applicability of Payment of Gratuity Act
- 1972 to temples
- definition of 'commercial establishment' under Karnataka Shops and Commercial Establishments Act
- 1961
- definition of 'temple' under Karnataka Hindu Religious Institutions and Charitable Endowments Act
- 1997
- interpretation of 'establishment' under Section 1(3)(b) of Payment of Gratuity Act
- primacy of special law over general law
- reference to larger bench under Section 4 of Karnataka High Court Act.
Case Details
2019 LawText (KAR) (08) 24
B.V. Nagarathna, K.N. Phaneendra, B.A. Patil
Anandarama K. (for appellant), T. Mohandas Shetty (for R-1), S.S. Mahendra, AGA (for R-2 and R-3)
SHRI MOOKAMBIKA TEMPLE, KOLLUR, KUNDAPURA, UDUPI DISTRICT, REPRESENTED BY ITS EXECUTIVE OFFICER, SRI L.S. MARUTHI
1. MR. RAVIRAJA SHETTY, 2. THE DEPUTY CHIEF LABOUR COMMISSIONER AND APPELLATE AUTHORITY UNDER PAYMENT OF GRATUITY ACT, HASSAN REGION, HASSAN, 3. THE ASSISTANT LABOUR COMMISSIONER AND CONTROLLING AUTHORITY UNDER PAYMENT OF GRATUITY ACT, MANGALORE DIVISION, MANGALORE
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Nature of Litigation
The litigation involves a claim for gratuity by a former employee of a temple under the Payment of Gratuity Act, 1972, with the temple disputing the applicability of the Act.
Remedy Sought
The temple (appellant) seeks to set aside the order of the learned Single Judge rejecting its writ petition, and ultimately to overturn the orders of the authorities granting gratuity to the respondent employee.
Filing Reason
The appellant filed the writ appeal against the Single Judge's order which upheld the gratuity award, arguing that the Payment of Gratuity Act does not apply to temples governed by the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997.
Previous Decisions
The Controlling Authority and the Appellate Authority under the Payment of Gratuity Act had allowed the employee's claim for gratuity. The Single Judge of the High Court dismissed the temple's writ petition, relying on the Division Bench decision in Management of Venkataramana Swamy Temple. The temple then filed the present writ appeal, and during its hearing, the Division Bench referred the questions of law to a Full Bench.
Issues
Whether the appellant, being a 'temple' as defined in clause (27) of Section 2 of the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997, answers to the description of 'commercial establishment' within the meaning of clause (e) of Section 2 of the Karnataka Shops and Commercial Establishments Act, 1961 and thereby, is an 'establishment' within the meaning of the said Act of 1961; and hence, the Payment of Gratuity Act, 1972 is inapplicable to it by virtue of clause (b) of sub-section (3) of Section 1 thereof?
Whether the law declared by the Division Bench of this Court in the case of Management of Venkataramana Swamy Temple (supra), that a clerk in a temple is entitled to claim the benefit of gratuity on attaining the age of superannuation under the Payment of Gratuity Act, 1972, stands in conformity with the provisions of law applicable in the State of Karnataka?
Submissions/Arguments
Appellant's counsel contended that the decisions relied upon by the Single Judge, including the Orissa High Court decision in Shree Jagannath Temple case, did not determine that every temple is an 'establishment' under the Payment of Gratuity Act and that the specific definitions under the Karnataka Shops and Commercial Establishments Act, 1961 and the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997 were not considered. Reliance was placed on Kerala and Madras High Court decisions holding the Act inapplicable to temple employees, and on Supreme Court decisions concerning the primacy of special laws over general laws.
Judgment Excerpts
whether the appellant, being a ‘temple’ as defined in clause (27) of Section 2 of the Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997, answers to the description of ‘commercial establishment’ within the meaning of clause (e) of Section 2 of the Karnataka Shops and Commercial Establishments Act, 1961 and thereby, is an ‘establishment’ within the meaning of the said Act of 1961; and hence, the Payment of Gratuity Act, 1972 is in applicable to it by virtue of clause (b) of sub-section (3) of Section 1 thereof?
‘commercial establishment’ means a commercial or trading or banking or insurance establishment, an establishment or administrative service in which persons employed are mainly engaged in office work, a hotel restaurant, boarding or eating house, a café or any other refreshment house, a theatre or any other place of public amusement or entertainment and includes such establishments as the State Government may by notification declare to be a commercial establishment for the purposes of this Act.
It remains seriously questionable if the aforesaid concept of ‘commercial establishment’ under the Act of 1961 would take within its sweep and ambit a temple like the appellant too.
Procedural History
The respondent employee was initially relieved from duties on 29.11.2005, which he challenged in W.P. No.27385/2005. An interim order was granted on 20.01.2006, and the petition was disposed of on 04.01.2008 with liberty to seek relief if the age of superannuation was held to be 65 years. He was finally relieved with effect from 31.12.2008. He then approached the Controlling Authority under the Payment of Gratuity Act, which by order dated 30.03.2011 directed the temple to pay Rs.2,91,351/- with interest at 10% p.a. The temple's appeal (Appeal No.08/2011-12) was dismissed by the Appellate Authority on 26.04.2012, confirming the Controlling Authority's order. The temple filed W.P. No.54267/2013 before the High Court, which a Single Judge dismissed on 18.02.2014, holding that the issue was covered by the Division Bench decision in Management of Venkataramana Swamy Temple. The temple then filed this writ appeal (WA No.1756/2015) with a delay of 445 days, which was condoned. During the hearing of the appeal, the Division Bench found that arguable questions of law arose and, by order dated 20.07.2018, referred the two questions to a Full Bench. The Full Bench heard the matter on 04.04.2019 and pronounced the order on 01.08.2019.
Acts & Sections
- Payment of Gratuity Act, 1972: Section 1(3)(b)
- Karnataka Shops and Commercial Establishments Act, 1961: Section 2(e), Section 2(i)
- Karnataka Hindu Religious Institutions and Charitable Endowments Act, 1997: Section 2(27)
- Karnataka High Court Act: Section 4
