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Sec. 2 The Payment of Gratuity Act, 1972 1
THE PAYMENT OF GRATUITY ACT, 1972
Sec. [NO. 39 OF 1972] [21st^ August, 1972] An Act to provide for a scheme for the payment of gratuity to employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments and for matters connected therewith or incidental thereto. Be it enacted by Parliament in the Twenty-third Year of the Republic of India as follows:- 1. Short title, extent, application and commencement.- (1) This Act may be called the Payment of Gratuity Act, 1972. (2) It extends to the whole of India: Provided that in so far as it relates to plantations or ports, it shall not extend to the State of Jammu and Kashmir. (3) It shall apply to- (a) every factory, mine, oilfield, plantation, port and railway company; (b) every shop or establishment within the meaning of any law for the time being in force in relation to shops and establishments in a State, in which ten or more persons are employed, or were employed, on any day of the preceding twelve months; (c) such other establishments or class of establishments, in which ten or more employees are employed, or were employed, on any day of the preceding twelve months, as the Central Government may, by notification, specify in this behalf. (^1) [(3-A) A shop or establishment to which this Act has become applicable shall continue to be governed by this Act, notwithstanding that the number of persons employed therein at any time after it has become so applicable falls below ten.] (4) It shall come into force on such date^2 as the Central Government may, by notification, appoint. 2. Definitions.- In this Act, unless the context otherwise requires,- (a) “appropriate Government” means,- (i) in relation to an establishment:- (a) belonging to, or under the control of, the Central Government (b) having branches in more than one State (c) of a factory belonging to, or under the control of, the Central Government. (d) of a major port, mine, oilfield or railway company, the Central Government. (ii) in any other case, the State Government. 1 Ins. by Act 26 of 1984, sec. 2 (w.e.f. 18- 5 - 1984). 2 Came into force on 16 - 9 - 1972, vide S.O. 601 (E), date d16th September, 1972, published in the Gazette of India, Extra., PT. II, Sec. 3(ii), p. 1641. Provisions of the Act came into force on 1- 11 - 1995 in the State of Sikkim, vide S.O. 837 (E), dated 12th^ October, 1995, published in the Gazette of India, Extra., PT. II, Sec. 3(ii), dated 13th^ October, 1995.
2 The Payment of Gratuity Act, 1972 Sec. 2 (b) “completed year of service” means continuous service for one year. (^1) [(c) “continuous service” means continuous service as defined in Section 2-A;] (d) “controlling Authority” means an authority appointed by the appropriate Government under Section 3; (^2) [(e) “employee” means any person (other than an apprentice) who is employed for wages, whether the terms of such employment are express or implied, in any kind of work, manual or otherwise, in or in connection with the work of a factory, mine, oilfield, plantation, port, railway company, shop or other establishment to which this Act applies, but does not include any such person who holds a post under the Central Government or a State Government and is governed by any other Act or by any rules providing for payment of gratuity;] (^3) [***] (f) “Employer” means, in relation to any establishment, factory, mine, oilfield, plantation, port, railway company or shop:- (i) belonging to, or under the control of, the Central Government or a State Government, a person or authority appointed by the appropriate Government for the supervision and control of employees, or where no person or authority has been so appointed, the head of the Ministry or the Department concerned, (ii) belonging to, or under the control of, any local authority, the person appointed by such authority for the supervision and control of employees or where no person has been so appointed, the chief executive officer of the local authority. (iii) in any other case, the person, who, or the authority which, has the ultimate control over the affairs of the establishment, factory, mine, oilfield, plantation, port, railway company or shop, and where the said affairs are entrusted to any other person, whether called a manager, or managing director or by any other name, such person; (g) “Factory” has the meaning assigned to it in clause (m) of section 2 of the Factories Act, 1948 (63 of 1948); (h) “Family”, in relation to an employee, shall be deemed to consist of:- (i) in the case of a male employee, himself, his wife, his children, whether married or unmarried, his dependent parents 4 [and the dependent parents of his wife and the widow] and children of his predeceased son, if any. (ii) in the case of a female employee, herself, her husband, her children, whether married or unmarried, her dependent parents and the dependent parents of her 1 Sub. by Act No.26 of 1984, sec. 3 for clause (c) (w.e.f. 18- 5 - 1984). 2 Substituted by the Payment of Gratuity (Amendment) Act, 2009 (47 of 2009), dated 31- 12 - 2009 (w.r.e.f. 03- 04 - 1997). 3 Explanation omitted by Act 34 of 1994, sec. 2 (w.e.f. 24- 5 - 1994). 4 Subs. by Act 22 of 1987 sec. 2 (w.e.f.) 1.10.1987.
4 The Payment of Gratuity Act, 1972 Sec. 3 cessation of work not due to any fault of the employee, whether such uninterrupted or interrupted service was rendered before or after the commencement of this Act; (2) Where an employee (not being an employee employed in a seasonal establishment) is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer- (a) for the said period of one year, if the employee during the period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than- (i) one hundred and ninety days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and (ii) two hundred and forty days, in any other case: (b) for the said period of six months if the employee during the period of six calendar months preceding the date with reference to which the calculation is to be made, has actually worked under the employer for not less than- (i) ninety-five days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and (ii) one hundred and twenty days, in any other case; (^1) [Explanation.- For the purpose of clause (2), the number of days on which an employee has actually worked under an employer shall include the days on which- (i) he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Orders) Act, 1946 (20 of 1946), or under the Industrial Disputes Act, 1947 (14 of 1947), or under any other law applicable to the establishment; (ii) he has been on leave with full wages, earned in the previous year; (iii) he has been absent due to temporary disablement caused by accident arising out of and in the course of his employment; and (iv) in the case of a female, she has been on maternity leave; so, however, that the total period of such maternity leave does not exceed twelve weeks]. (3) Where an employee, employed in a seasonal establishment, is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer for such period if he has actually worked for not less than seventy-five per cent of the number of days on which the establishment was in operation during such period.] 3. Controlling Authority.- The Appropriate Government, may, by notification, appoint any officer to be a controlling authority, who shall be responsible for the administration of this Act and different controlling authorities may be appointed for different areas. 1 Add. by Act 22 of 1987 sec. 3 (w.e.f. 1.10.1987).
Sec. 4 The Payment of Gratuity Act, 1972 5 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, (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: (^1) [Provided further that in 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 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. (2) For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days' wages based on the rate of wages last drawn by the employee concerned: Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account: Provided further that in the case of 2 [an employee who is employed in a seasonal establishment, and who is not so employed throughout the year], the employer shall pay the gratuity at the rate of seven days' wages for each season. (^3) [Explanation.- In the case of a monthly rated employee, the fifteen days' wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen.] (3) The amount of gratuity payable to an employee shall not exceed 4 [ten lakh rupees]. (4) For the purpose of computing the gratuity payable to an employee who is employed, after his disablement, on reduced wages, his wages for the period preceding his disablement shall be taken to be the wages received by him during that period, and his wages for the period subsequent to his disablement shall be taken to be the wages as so reduced. (5) Nothing in this section shall affect the right of an employee to receive better terms of gratuity under any award or agreement or contract with the employer. (6) Notwithstanding anything contained in sub-section (i),- (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 1 Subs by Act 22 of 1987, sec. 4, for the second proviso (w.e.f. 1.2.1991). 2 Subs by Act 25 of 1984, sec. 3, for “an employee employed n a seasonal establishment” (w.e.f. 1.7.1984). 3 Ins by Act 22 of 1987, sec. 4 (w.e.f. 24- 9 - 1997). **4 Substituted by the Payment of Gratuity (Amendment) Act, 2010 (Act No.15 of
- dated 17th**^ May, 2010 (w.e.f. 24- 05 - 2010).
Sec. 6 The Payment of Gratuity Act, 1972 7 a continuing offence with a further fine which may extend to one thousand rupees for each day during which the offence continues. Explanation.- In this section “approved gratuity fund” shall have the same meaning as in clause (v) of Section 2 of the Income Tax Act, 1961 (43 of 1961)]. 5. Power to exempt.-^1 [(1) The appropriate Government may, by notification, and subject to such conditions as may be specified in the notification, exempt any establishment, factory, mine, oilfield, plantation, port, railway company or shop to which this Act applies from the operation of the provisions of this Act if, in the opinion of the appropriate Government, the employees in such establishment, factory, mine, oilfield, plantation, port, railway company or shop are in receipt of gratuity or pensionary benefits not less favourable than the benefits conferred under this Act. (^2) [(2) The appropriate Government may, by notification and subject to such conditions as may be specified in the notification, exempt any employee or class of employees employed in any establishment, factory, mine, oilfield, plantation, port, railway company or shop to which this Act applies from the operation of the provisions of this Act, if, in the opinion of the appropriate Government, such employee or class of employees are in receipt of gratuity or pensionary benefits not less favourable than the benefits conferred under this Act.] (^3) [(3) A notification issued under sub-section (1) or sub-section (2) may be issued retrospectively a date not earlier than the date of commencement of this Act, but no such notification shall be issued so as to prejudicially affect the interest of any person]. 6. Nomination.- (1) Each employee, who has completed one year of service, shall make, within such time, in such form and in such manner, as may be prescribed, nomination for the purpose of the second proviso to sub-section (1) of Section 4. (2) An employee may, in his nomination, distribute the amount of gratuity payable to him under this Act amongst more than one nominee. (3) If an employee has a family at the time of making a nomination, the nomination shall be made in favour of one or more members of his family, and any nomination made by such employee in favour of a person who is not a member of his family, shall be void. (4) If at the time of making a nomination the employee has no family, the nomination may be made in favour of any person or persons but if the employee subsequently acquires a family, such nomination shall forthwith become invalid and the employee shall make, within such time as may be prescribed, a fresh nomination in favour of one or more members of his family. (5) A nomination may, subject to the provisions of sub-sections (3) and (4), be modified by an employee at any time, after giving to his employer a written notice in such form and in such manner as may be prescribed, of his intention to do so. (6) If a nominee predeceases the employee, the interest of the nominee shall revert to the employee who shall make a fresh nomination in the prescribed form, in respect of such interest. (7) Every nomination, fresh nomination or alteration of nomination, as the case may be, shall be sent by the employee to his employer, who shall keep the same in his safe custody. 1 Section 5 renumbered as sub-section (1) thereof by Act No.26 of 1984, sec. 5 (w.e.f. 18- 5 - 1984). 2 Ins. by Act No.26, sec. 5 (w.e.f. 1984). 3 Ins. by Act No.22 of 1987, sec 6, (w.e.f. 1.10.1987).
8 The Payment of Gratuity Act, 1972 Sec. 7 7. Determination of the amount of Gratuity.- (1) A person who is eligible for payment of gratuity under this Act or any person authorised, in writing, to act on his behalf shall send a written application to the employer, within such time and in such form, as may be prescribed, for payment of such gratuity. (2) As soon as gratuity becomes payable, the employer shall, whether an application referred to in sub-section (i) has been made or not, determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the controlling authority specifying the amount of gratuity so determined. (^1) [(3) The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable to the person to whom the gratuity is payable. (3-A) If the amount of gratuity payable under sub-section (3) is not paid by the employer within the period specified in sub-section (3) the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long term deposits, as that Government may, by notification specify: Provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has obtained permission in writing from the Controlling Authority for the delayed payment on this ground]. (4)(a) If there is any dispute as to the amount of gratuity payable to an employee under this Act or as to the admissibility of any claim of, or in relation to, an employee for payment of gratuity, or as to the person entitled to receive the gratuity, the employer shall deposit with the Controlling Authority such amount as he admits to be payable by him as gratuity. (^2) [***] (^3) [(b) Where there is a dispute with regard to any matter or matters specified in Clause (a), the employer or employee or any other person raising the dispute may make an application to the Controlling Authority for deciding the dispute.] (^4) [ (^5) [(c)] The Controlling Authority shall, after due inquiry and after giving the parties to the dispute a reasonable opportunity of being heard, determine the matter or matters in dispute and, if, as a result of such inquiry any amount is found to be payable to the employee, the Controlling Authority shall direct the employer to pay such amount or, as the case may be, such amount as reduced by the amount already deposited by the employer.] (^6) [(d)] The Controlling Authority shall pay the amount deposited, including the excess amount, if any, deposited by the employer, to the person entitled thereto. (^7) [(e)] As soon as may be after a deposit is made under Clause (a), the Controlling Authority shall pay the amount of the deposit- (i) to the applicant where he is the employee; or 1 Subs. by Act No. 22 of 1987, sec. 7 for sub-section (3), (w.e.f. 1.10.1987). 2 The Explanation omitted by Act 25 of 1984, sec. 4 (w.e.f. 1.7.1984). 3 Ins. by Act 25 of 1984, sec. 4, (w.e.f 1- 7 - 1984). 4 Clause (b) re-lettered as clauses (c) by Act No.25 of 1984 sec. 4, *(w.e.f. 1.7.1984). 5 Clause ((c) subs. by Act No.25 of 1984, sec. 4, and clause (c) (w.e.f. 1.7.1984). 6 Clause (c) and (d) re-lettered as clauses (d) and (e) by Act No.25 of 1984 sec. 4 (w.e.f. 1.7.1984. 7 Clause (c) and (d) re-lettered as clauses (d) and (e) by Act No.25 of 1984 sec. 4 (w.e.f. 1.7.1984.
10 The Payment of Gratuity Act, 1972 Sec. 8 (a) require an employer to furnish such information as he may consider necessary; (b) enter and inspect, at all reasonable hours, with such assistants (if any), being persons in the service of the Government or local or any public authority, as he thinks fit, any premises of or place in any factory, mine, oil-field, plantation, port, railway company, shop or other establishment to which this Act applies, for the purpose of examining any register, record or notice or other document required to be kept or exhibited under this Act or the rules made thereunder, or otherwise kept or exhibited in relation to the employment of any person or the payment of gratuity to the employees, and require the production thereof for inspection; (c) examine with respect to any matter relevant to any of the purposes aforesaid, the employer or any person whom he finds in such premises or place and who, he has reasonable cause to believe, is an employee employed therein; (d) make copies of, or take extracts from any register, record, notice or other document, as he may consider relevant, and where he has reason to believe that any offence under this Act has been committed by an employer, search and seize with such assistance as he may think fit, such register, record, notice or other document as he may consider relevant in respect of that offence; (e) exercise such other powers as may be prescribed. (2) Any person required to produce any register, record, notice or other document or to give any information, by an Inspector under sub-section (1) shall be deemed to be legally bound to do so within the meaning of Sections 175 and 176 of the Indian Penal Code (45 of 1860). (3) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974), shall so far as may be, apply to any search or seizure under this section as they apply to any search or seizure made under the authority of a warrant issued under Section 94 of that Code.] 8. Recovery of Gratuity.- If the amount of gratuity payable under this Act is not paid by the employer, within the prescribed time, to the person entitled thereto, the controlling authority shall, on an application made to it in this behalf by the aggrieved person, issue a certificate for that amount to the Collector, who shall recover the same, together with compound interest thereon 1 [at such rate as the Central Government may, by notification, specify] from the date of expiry of the prescribed time, as arrears of land revenue and pay the same to the person entitled thereto: (^2) [Provided that the Controlling Authority shall, before issuing a certificate under this section, give the employer a reasonable opportunity of showing cause against the issue of such certificate: Provided further that the amount of interest payable under this section shall, in no case, exceed the amount of gratuity payable under this Act]. 9. Penalties.- (1) Whoever, for the purpose of avoiding any payment to be made by himself under this Act or of enabling any other person to avoid such payment, knowingly makes or causes to be made any false statement or false representation shall be punishable with imprisonment for a term which may 1 Subs. by Act 22 of 1987, sec.8, for “at the rate of nine per cent. per annum” (w.e.f. 1- 10 - 1987). 2 Added by Act 22 of 1987 sec. 8 (w.e.f. 1- 10 - 1987).
Sec. 11 The Payment of Gratuity Act, 1972 11 extend to six months, or with fine which may extend to 1 [ten thousand rupees] or with both. (2) An employer who contravenes, or makes default in complying with, any of the provisions of this Act or any rule or order made thereunder shall be punishable with imprisonment for a term 2 [which shall not be less than three months but which may extend to one year, or with fine which shall not be less than ten thousand rupees but which may extend to twenty thousand rupees, or with both]: Provided that where the offence relates to non-payment of any gratuity payable under this Act, the employer shall be punishable with imprisonment, for a term which shall not be less than 3 [six months but which may extend to two years] unless the Court trying the offence, for reasons to be recorded by it in writing, is of opinion that a lesser term of imprisonment or the imposition of a fine would meet the ends of justice. 10. Exemption of employer from liability in certain cases.- Where an employer is charged with an offence punishable under this Act, he shall be entitled, upon complaint duly made by him and on giving to the complainant not less than three clear days' notice in writing of his intention to do so, to have any other person whom he charges as the actual offender brought before the Court at the time appointed for hearing the charge; and if, after the commission of the offence has been proved, the employer proves to the satisfaction of the Court- (a) that he has used due diligence to enforce the execution of this Act; and (b) that the said other person committed the offence in question without his knowledge, consent or connivance, that other person shall be convicted of the offence and shall be liable to the like other punishment as if he were the employer and the employer shall be discharged from any liability under this Act in respect of such offence: Provided that in seeking to prove as aforesaid, the employer may be examined on oath and his evidence and that of any witness whom he calls in his support shall be subject to cross-examination on behalf of the person he charges as the actual offender and by the prosecutor: Provided further that, if the person charged as the actual offender by the employer cannot be brought before the Court at the time appointed for hearing the charge, the Court shall adjourn the hearing from time to time for a period not exceeding three months and if by the end of the said period the person charged as the actual offender cannot still be brought before the Court, the Court shall proceed to hear the charge against the employer and shall, if the offence be proved, convict the employer. 11. Cognizance of Offence.- (1) No Court shall take cognizance of any offence punishable under this Act save on a complaint made by or under the authority of the appropriate Government: Provided that where the amount of gratuity has not been paid, or recovered, within six months from the expiry of the prescribed time, the appropriate Government shall authorise the controlling authority to make a complaint against the employer, whereupon the controlling authority shall, within fifteen days from the date of such authorisation, make such complaint to a Magistrate having jurisdiction to try the offence. 1 Subs. by Act No. 22 of sec. 9, for “one thousand rupees” (w.e.f. 1.10.1987). 2 Subs. by Act No. 22 of 1987 sec. 9, for certain words (w.e.f. 1.10.1987). 3 Subs. by Act No. 22 of 1987 (sec. 9, for “three months” (w.e.f. 1.10.1987).
Rule 5 The Payment of Gratuity (Central) Rules, 1972 13
THE PAYMENT OF GRATUITY (CENTRAL) RULES, 19721
Rule In exercise of the powers conferred by sub-section (1) of section 15 of the Payment of Gratuity Act, 1972 (39 of 1972), the Central Government hereby makes the following rules, namely:- 1. Short title and commencement:- (1) These rules may be called The Payment of Gratuity (Central) Rules, 1972. (2) These rules shall come into force on the 16th^ September, 1972. 2. Definitions:- In these rules, unless there is anything repugnant in the subject or context,- (a) “Act” means the Payment of Gratuity Act, 1972 (39 of 1972); (b) “Appellate Authority” means the Central Government or the authority specified by the Central Government under sub-section (7) of section 7; (c) “Form” means a form appended to these rules; (d) “nomination” means nomination made under section 6; (e) “Section” means a section of the Act. 3. Notice of opening, change or closure of the establishment:- (1) Within thirty days of the rules becoming applicable to an establishment, a notice in Form ‘A’ shall be submitted by the employer to the Controlling Authority of the area. (2) A notice in Form ‘B’ shall be submitted by the employer to the controlling authority of the area within thirty days of any change in the name, address, employer or nature of business. (3) Where an employer intends to close down the business he shall submit a notice in Form ‘C’ to the controlling authority of the area at least sixty days before the intended closure. 4. Display of notice:- (1) The employer shall display conspicuously a notice at or near the main entrance of the establishment in bold letters in English and in a language understood by the majority of the employees specifying the name of officer with designation authorised by the employer to receive on his behalf notices under the Act or the rules. (2) A fresh notice shall be displayed immediately after the notice referred to in sub-rule (1) becomes illegible or requires a change. (^25). Form of notice under proviso to section (2) (h) (ii):- (1) A notice under the proviso to sub-clause (ii) of clause (h) of section 2, shall be in Form ‘D’ and sent in triplicate by the employee to the employer, who shall, after recording its receipt on one copy thereof, return the copy to the employee and send the second copy to the controlling authority of the area. (2) An employee may withdraw the notice referred to in sub-rule (1) by giving another notice in triplicate in Form ‘E’ to the employer, who shall follow the same procedure as in sub-rule (1). 1 Vide G.S.R. 412 (E), dated 16th September, 1972, published in the Gazette of India, Extra., Pt. II, Sec. 3(i), dated 16th September, 1972. 2 By section 2 of the Payment of Gratuity (Amendment) Act, 1987 (22 of 1987) proviso to sub-clause (ii) of clause (h) of section 2 of the Payment of Gratuity Act, 1972 (39 of
- has been omitted (w.e.f. 1- 10 - 1987) and accordingly rule 5 along with Forms D and E have became redundant, Ed.
14 The Payment of Gratuity (Central) Rules, 1972 Rule 6 6. Nominations:- (1) A nomination shall be in Form ‘F’ and submitted in duplicate by personal service by the employee, after taking proper receipt or by sending through registered post acknowledgement due to the employer, (i) in the case of an employee who is already in employment for a year or more on the date of commencement of these rules, ordinarily, within ninety days from such date, and (ii) in the case of an employee who completes one year of service after the date of commencement of these rules, ordinarily, within thirty days of the completion of one year of service: Provided that nomination in Form ‘F’ shall be accepted by the employer after the specified period, if filed with reasonable grounds for delay, and no nomination so accepted shall be invalid merely because it was filed after the specified period. (2) Within thirty days of the receipt of nomination in Form ‘F’ under sub-rule (1), the employer shall get the service particulars of the employee, as mentioned in the form of nomination, verified with reference to the records of the establishment and return to the employee, after obtaining a receipt thereof, the duplicate copy of the nomination in Form ‘F’ duly attested either by the employer or an officer authorised in this behalf by him, as a token of recording of the nomination by the employer and the other copy of the nomination shall be recorded. (3) An employee who has no family at the time of making a nomination shall, within ninety days of acquiring a family submit in the manner specified in sub- rule (1), a fresh nomination, as required under sub-section (4) of section 6, duplicate in Form ‘G’ to the employer and thereafter the provisions of sub-rule (2) shall apply mutatis mutandis as if it was made under sub-rule (1). (4) A notice of modification of a nomination, including cases where a nominee predeceases an employee, shall be submitted in duplicate in Form ‘H’ to the employer in the manner specified in sub-rule (1), and thereafter the provisions of sub-rule (2) shall apply mutatis mutandis. (5) A nomination or a fresh nomination or a notice of modification of nomination shall be signed by the employee or, if illiterate, shall bear his thumb impression, in the presence of two witnesses, who shall also sign a declaration to that effect in the nomination, fresh nomination or notice of modification of nomination as the case may be. (6) A nomination, fresh nomination or notice of modification of nomination shall take effect from the date of receipt thereof by the employer. 7. Application for gratuity:- (1) An employee who is eligible for payment of gratuity under the Act, or any person authorised in writing, to act on his behalf, shall apply, ordinarily within thirty days from the date the gratuity became payable, in Form ‘I’ to the employer: Provided that where the date of superannuation or retirement of an employee is known, the employee may apply, to the employer before thirty days of the date of superannuation or retirement. (2) A nominee of an employee who is eligible for payment of gratuity under the second proviso to sub-section (1) of section 4 shall apply, ordinarily, within thirty days from the date of gratuity become payable to him, in Form ‘J’ to the employer. Provided that an application in plain paper with relevant particulars shall also be accepted. The employer may obtain such other particulars as may be deemed necessary by him. (3) A legal heir of an employee who is eligible for payment of gratuity under the second proviso to sub-section (1) of section 4 shall apply, ordinarily within
16 The Payment of Gratuity (Central) Rules, 1972 Rule 10 (^1) [Provided further that in the case of nominee, or an heir, who is minor, the Controlling Authority shall invest the gratuity amount deposited with him for the benefit of such minor in term deposit with the State Bank of India or any of its subsidiaries or any Nationalised Bank. Explanation :-”Nationalised Bank” means a corresponding new bank specified in the First Schedule to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970) or a corresponding new bank specified in the First Schedule of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980).] 10. Application to controlling authority for direction:- (1) If an employer- (i) refuses to accept a nomination or to entertain an application sought to be filed under rule 7, or (ii) issues a notice under sub-rule (1) of rule 8 either specifying an amount of gratuity which is considered by the applicant less than what is payable or rejecting eligibility to payment of gratuity, or (iii) having received an application under rule 7 fails to issue any notice as required under rule 8 within the time specified therein, the claimant employee, nominee or legal heir, as the case may be, may within ninety days of the occurrence of the cause for the application, apply in Form ‘N’ to the controlling authority for issuing a direction under sub-section (4) of section 7 with as many extra copies as are the opposite party: Provided that the controlling authority may accept any application under this sub-rule, on sufficient cause being shown by the applicant, after the expiry of the specified period. (2) Application under sub-rule (1) and other documents relevant to such an application shall be presented in person to the controlling authority or shall be sent by registered post acknowledgement due. 11. Procedure for dealing with application for direction:- (1) On receipt of an application under rule 10, the Controlling Authority shall, by issuing a notice in Form ‘O’, call upon the applicant as well as the employer to appear before him on a specified date, time and place, either by himself or through his authorised representative together with all relevant documents and witnesses, if any, (2) Any person desiring to act on behalf of an employer or employee, nominee or legal heir, as the case may be, shall present to the controlling authority a letter of authority from the employer or the person concerned, as the case may be, on whose behalf he seeks to act together with a written statement explaining his interest in the matter and praying for permission so to act. The Controlling Authority shall record thereon an order either according to his approval or specifying, in the case of refusal to grant the permission prayed for, the reasons for the refusal. (3) A party appearing by an authorised representative shall be bound by the acts of the representative. (4) After completion of hearing on the date fixed under sub-rule (1), or after such further evidence, examination of documents, witnesses, hearing and enquiry, as may be deemed necessary, the Controlling Authority shall record his finding as to whether any amount is payable to the applicant under the Act. A copy of the finding shall be given to each of the parties. (5) If the employer concerned fails to appear on the specified date of hearing after due service of notice without sufficient cause, the controlling authority may 1 Ins. by G.S.R. 77, dated 2nd February, 1991 (w.e.f. 1- 2 - 1991).
Rule 18 The Payment of Gratuity (Central) Rules, 1972 17 proceed to hear and determine the application ex parte. If the applicant fails to appear on the specified date of hearing without sufficient cause, the controlling authority may dismiss the application: Provided that an order under this sub-rule may, on good cause being shown within thirty days of the said order, be reviewed and the application re-heard after giving not less than fourteen days’ notice to the opposite party of the date fixed for re-hearing of the application. 12. Place and time of hearing:- The sitting of the controlling authority shall be held at such times and at such places as he may fix and he shall inform the parties of the same in such manner as he thinks fit. 13. Administration of oath:- The controlling authority may authorise a clerk of his office to administer oaths for the purpose of making affidavits. 14. Summoning and attendance of witnesses:- The controlling authority may, at any stage of the proceedings before him, either upon or without an application by any of the parties involved in the proceedings before him, and on such terms as may appear to the controlling authority just, issue summons to any person in Form ‘P’ either to give evidence or to produce documents or for both purposes on a specified date, time and place. 15. Service of summons or notice:- (1) Subject to the provisions of sub-rule (2) any notice, summons, process or order issued by the controlling authority may be served either personally or by registered post acknowledgement due or in any other manner as prescribed under the Code of Civil Procedure, 1908 (At 5 of 1908). (2) Where there are numerous persons as parties to any proceeding before the controlling authority and such persons are members of any trade union or association or are represented by an authorised person, the service of notice on the Secretary, or where there is no Secretary, on the principal officer of the trade union or association, or on the authorised person shall be deemed to be service on such persons. 16. Maintenance of records of cases by the controlling authority:- (1) The controlling authority shall record the particulars of each case under section 7, in Form ‘Q’ and at the time of passing orders shall sign and date the particulars so recorded. (2) The controlling authority shall, while passing orders in each case, also record the findings on the merits of the case and file it together with the memoranda of evidence with the order sheet. (3) Any record, other than a record of any order or direction, which is required by these rules to be signed by the controlling authority, may be signed on behalf of and under the direction of the controlling authority by any subordinate officer appointed in writing for this purpose by the controlling authority. 17. Direction for payment of gratuity:- If a finding, is recorded under sub- rule (4) of rule 11 that the applicant is entitled to payment of gratuity under the Act, the controlling authority shall issue a notice to the employer concerned in Form ‘R’ specifying the amount payable and directing payment thereof to the applicant under intimation to the controlling authority within thirty days from the date of the receipt of the notice by the employer. A copy of the notice shall be endorsed to the applicant employee, nominee or legal heir, as the case may be. 18. Appeal:- (1) The Memorandum of appeal under sub-section (7) of section 7 of the Act shall be submitted to the appellate authority with a copy thereof to
Forms The Payment of Gratuity (Central) Rules, 1972 19 FORM ‘A’ [SEE SUB-RULE (1) OF RULE 3] NOTICE OF OPENING
- Name and address of the Establishment.
- Name and designation of the Employer.
- Number of persons employed.
- Maximum number of persons employed on any day during the preceding twelve months with date.
- Number of employees covered by the Act.
- Nature of industry.
- Whether seasonal.
- Date of opening.
- Details of Head Office/Branches. (a) Name and address of the head office. Number of employees. (b) Names and addresses of other branches in India.
I verify that the information furnished above is true to the best of my knowledge and belief. Place Date Signature of the employer with name and designation To The Controlling Authority ………………………………. ………………………………. FORM ‘B’ [SEE SUB-RULE (2) OF RULE 3] NOTICE OF CHANGE Name and address of the Establishment, Take notice that following changes have taken place with effect from…….in the particulars furnished by me in notice dated……………..on Form ‘A’. Name Address Name of the employer. Nature of business Place Date Signature of the employer with name and designation To The Controlling Authority ………………………………. ……………………………….
20 The Payment of Gratuity (Central) Rules, 1972 Forms FORM ‘C’ [SEE SUB-RULE (3) OF RULE 3] NOTICE OF CLOSURE Take notice that it is intended to close down the establishment with effect from…………….The other details are furnished below.
- Name and address of the establishment.
- Name and designation of the Head Office, if any.
- Name and designation of the employer.
- Number of persons in employment.
- Number of employees entitled to Gratuity.
- Amount of Gratuity involved. Place Date Signature of the employer with name and designation To The Controlling Authority ………………………………. ………………………………. FORM ‘D’ [SEE SUB-RULE (1) OF RULE 5] NOTICE FOR EXCLUDING HUSBAND FROM FAMILY From……………………………………
- Name of the female employee.
- Name or description of establishment where employed.
- Post held with Ticket or Serial No., if any.
- Department/Branch/Section where employed.
- Permanent address. Take notice that I, Shrimati………………..desire to exclude my husband Shri…………….from my family for the purposes of the Payment of Gratuity Act,
Place Date Signature/Thumb impression of the employer DECLARATION BY WITNESSES The above notice was signed/thumb impressed before me. Name in full and full address of witnesses. Signature of witnesses 1. 1. 2. 2. Place Date To The Controlling Authority (Through the employer) [Name and address of the employer here]
