Daily wage service prior to regularization counts toward continuous service for calculating payment of gratuity.

The respondent was engaged as a daily wager by the petitioners in 1979 and was subsequently regularized in 1989

He retired upon superannuation on August 31, 2013

The petitioners calculated and paid his gratuity only for the post-regularization period (1989–2013), excluding the 10-year period of daily wage service

The respondent approached the Controlling Authority under the Payment of Gratuity Act, 1972, which ordered a recalculation of gratuity by including the period from 1979 to 1989

The Appellate Authority dismissed the petitioners' appeal on November 8, 2019

The petitioners challenged these orders via a Writ Petition under Article 226 of the Constitution, alleging a lack of documentary evidence for continuous service and claiming the application was barred by delay

1. Whether the period of service rendered as a daily wager prior to regularization should be counted for the purpose of calculating gratuity under the Payment of Gratuity Act, 1972

2. Whether the orders passed by the Controlling and Appellate Authorities suffered from any jurisdictional error or illegality regarding evidence and delay

The Court primarily applied the Payment of Gratuity Act, 1972, specifically Section 2A regarding "continuous service" and Section 7(4)(c) concerning inquiries into gratuity claims

It heavily relied on the precedent set by the Supreme Court in Netram Sahu v. State of Chhattisgarh (Civil Appeal No. 1254 of 2018), which established that once an employee’s services are regularized, they are entitled to count the total period of service (including daily wage service) for gratuity, provided continuous service is proven

The Court noted that the facts regarding the respondent’s tenure (1979–1989 as a daily wager and 1989–2013 as regularized) were undisputed

Applying the Netram Sahu precedent, the Court reasoned that it would be a "travesty of justice" to deny a statutory right to gratuity after 25 years of service simply because the State took a long time to regularize the employee

Regarding the petitioners' claim of lack of evidence, the Court observed that the State’s own records and materials established the respondent's continuous employment during the daily wage period

The Court found no merit in the petitioners' arguments regarding estoppel or delay, emphasizing that the statutory right to gratuity cannot be waived if the service criteria are met

The High Court found no illegality or jurisdictional error in the lower authorities' orders and dismissed the Writ Petition

The petitioners are required to comply with the directions to pay the differential gratuity amount with interest as ordered by the Controlling Authority

No order as to costs was made