D. Murugesan, J.@mdashBoth the writ appeals arise out of an order dated 23.10.2008 passed in W.P. No. 12297 of 2006. W.A. No. 118 of
2009 is at the instance of a salesman who worked under the Management of Parry and Company Ltd. and W.A. No. 144 of 2009 is filed by the
said Management.
2. The question in both the writ appeals relate to whether an employee, who has been terminated from service on the ground of proved mis-
conduct, would be disentitled to the payment of gratuity in terms of Section 4(6)(b)(ii) of the Payment of Gratuity Act, 1972 (hereinafter referred
to as ''the Act''). For convenience, we refer the parties as they were arrayed in the writ petition.
3. The facts of the case leading to the above question are as follows:
a) The writ petitioner was appointed as a salesman in the respondent-company, which is a commercial establishment acting as an agent for other
manufacturers. It owned a distillery sugar mill at Nellikuppam, which produces carbon-di-oxide (CO2) as bi-product. The said Carbon-di-oxide ia
stored in a tank and supplied in cylinders to the dealers/retailers. The petitioner was deputed to the said holding company and was posted as
salesman in charge of sale of CO2. He should keep constant touch with dealers and to oversee the maintenance of records relating to the cylinders
in the CO2 department of Nellikuppam factory. His work involved contacting dealers, customers and apprasing them of the effective use of the
product and to attend equitable distribution of the product among the various dealers.
(b) Sometime during March 1990, certain discrepancies relating to the receipt of empty cylinders from A.E. Duraisamy and Company,
Pondicherry, delivered on 30.11.1988 in the Cylinder Ledger Account came to be discovered. The statement of cylinders delivered to the said
company along with the delivery of empty cylinders showed that only 117 cylinders were actually returned back on 30.11.1988; on the other
hand, the entry relating to the empty cylinders return made on that day in the cylinder ledger account showed that it was 177 cylinders. On the
ground that there was a manipulation of entry and receipt of illegal gratification by the petitioner along with one other co-employee by name
Nicholas, the respondent-company found that the petitioner had acted prejudicial to the interest of the company. Hence, he was issued with a
charge memo, which ultimately resulted in the conduct of enquiry followed by an order of dismissal of the petitioner.
(c) That order of dismissal was challenged by the petitioner before the II Additional Labour Court, Madras, in I.D. No. 146 of 1992 and an
award dated 14.6.1994 came to be passed directing reinstatement of the petitioner with continuity of service and attendant benefits. That award
was questioned by the respondent-company in a writ petition before this Court, which was allowed. When the said order in the writ petition was
questioned by the petitioner by way of a writ appeal, the same was dismissed. A further appeal to the Supreme Court at the instance of the
petitioner was also dismissed on 10.4.2000. In view of the above, the order of dismissal of the petitioner from service became final.
(d) In view of the dismissal order became final, the respondent-company issued a show cause notice asking the petitioner to give his explanation as
to why the gratuity should not be forfeited for his proved mis-conduct of dishonesty in connection with the company''s business. The petitioner
submitted an explanation and not satisfied with the said explanation, the respondent passed an order on 9.10.1991 forfeiting the gratuity amount to
the petitioner.
(e) Aggrieved by the said order, the petitioner filed an appeal before the Controlling Authority, which was dismissed. A further appeal was also
filed by the petitioner before the Joint Commissioner of Labour, the appellate authority under the Act, and the same was also dismissed. The
reason adduced by the respondent-company, which was subsequently confirmed by the Controlling Authority and the Appellate Authority was that
the misconduct of the petitioner which was held to be proved would amount to an offence involving moral turpitude and therefore, in terms of the
provision of Section 4(6)(b)(ii) of the Act, the respondent-company would be entitled to forfeit the gratuity amount either wholly or in part.
(f) The order of the Appellate Authority, confirming the orders of the Controlling Authority and the respondent-company, was again questioned by
the petitioner in the present writ petition and the same was allowed. While allowing the writ petition, the learned Judge has quashed the order of the
respondent-company dated 9.10.1991, which was confirmed by the Controlling Authority as well as the Appellate Authority and directed the
disbursement of gratuity amount of Rs. 59,466/-. Aggrieved by the said order, the respondent-company has filed W.A. No. 144 of 2009 and
equally aggrieved by the said order in not awarding interest on the delayed payment, the writ petitioner has preferred W.A. No. 118 of 2009.
4. We have heard Mr. V. Prakash, learned senior counsel appearing on behalf of the writ petitioner and Mr. V. Karthick, learned Counsel
appearing on behalf of the respondent-company.
5. The core questions to be considered in these writ appeals are:
(i) Whether the proved misconduct of the petitioner would amount to moral turpitude, thereby disentitling him for payment of gratuity ? and
(ii)If not, whether the petitioner would be entitled to interest for the delayed payment ?
6. The relevant provision which is relied upon by the respondent-company, viz. Section 4(6)(b)(ii) of the Act, reads as under:
4. Payment of gratuity. -
...
(6) Notwithstanding anything contained in Sub-section (1), -
(a) ...
(b) the gratuity payable to an employee may be wholly or partially forfeited -
(i) if the services of such employee have been terminated for the riotous or disorderly conduct or any other act of violence on his part, or
(ii) if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such
offence is committed by him in the course of his employment.
7.1. The term ''Moral turpitude'' is a phrase which can hardly be accurately defined. It can have various shades of meaning in various sets of
circumstances and will have different meanings in different contexts. No absolute standard can be laid down for deciding whether a particular act is
to be considered as one involving ''moral turpitude''. The said term is rather vague one, where it is virtually important not to be vague.
7.2. If an act or a behaviour is inherently bad, it could be known as ''malum in se'' in contrast to the behaviour that is bad because it is forbidden in
law, viz., ''malum prohibitum''. ''Moral turpitude'', in the normal sense, is understood only with reference to an act or behaviour of a person, which,
in turn, would amount to an offence. In criminal law, it is a phrase used to describe the conduct that is considered contrary to the community
standards of justice, honesty and good morals.
7.3. The Law Lexicon refers to the term ''moral turpitude'' to be an act of baseness, vileness or depravity in private and social duties owing to
fellow men of society in general, contrary to the accepted and customary rule of right and duty between man and man. The Random House
Dictionary of the Engligh Language explains the word Moral - of pertaining to or concerned with right conduct or its principles and being in
accordance with such principles. Conforming to these principles rather than to law, custom, etc. turpitude is stated to mean - baseness or
depravity.
7.4. In the judgment of Federal Court in Pullman''s Palace Car Co. v. Central Transport Co. 65 FED 158, it is stated as follows:
A term not clearly defined - What constitutes moral turpitude, or what will be held such, is not entirely clear. A contract to promote public wrong,
short of crime, may or may not involve it. If parties intend such wrong, as where they conspire against the public interests by agreeing to violate the
law or some rule of public policy, the act doubtless involves moral turpitude. When no wrong is contemplated, but is unintentionally committed,
through error of judgment, it is otherwise.
The American Encyclopaedia of Law refers to the term ''moral turpitude'' as anything done contrary to justice, honesty, principle or good morals,
an act of baseness, vileness or deprivity in the private and social duties which a man owes to his fellowmen or society in general, contrary to the
accepted and customary rule of right and duty between man and man. The Punjab and Haryana High Court in Chandgi Ram Thakar Dass Vs.
Election Tribunal and Assistant Development Commissioner for Panchayat Election, Delhi and Others, , held that ''Moral turpitude'' refers to
conduct that is inherently base, vile or depraved and contrary to the accepted rules of morality, whether it is or is not punishable as a civil
possession of fire are by a person who has not engaged in neferious activities, does not amount to moral turpitude. Similarly, the Punjab High
Court in Risal Singh Vs. Chandgi Ram and Others, , termed the word ''moral turpitude'' which implies depravity and wickedness of character or
disposition of the person charged with the particular conduct. The Himachala Pradesh High Court, in Prem Kumar Vs. State of Himachal Pradesh
and Others, , had observed that ''a conviction of a person u/s 16 of the Act does not mean that he has committed an offence involving moral
turpitude, unless the facts on which the conviction is based are known. In Mangali Vs. Chhakki Lal and Others, , the Allahabad High Court had
held as follows:
The taste which should ordinarily be applied for judging whether a certain offence does or does not involve moral turpitude appear to be (1)
whether the act leading to a conviction was such as could shock moral conscience of society in general, (2) whether the motive which led to the act
was a base one and (3) whether on account of the act having been committed the perpetrator could be considered to be of a depraved character
or a person who was to be looked down upon by the society.
7.5. Hence, the term ''moral turpitude'' can safely be understood to mean that it is a conduct which is not only contrary to the accepted behaviour,
but also a behaviour which is grossly misdirected. The application of the term depends upon the facts of each case, which, in turn, depends upon
the act or behaviour which is sought to be described as moral turpitude. The standard of application of the term cannot be the same when it
concerns with criminal jurisprudence and civil jurisprudence, particularly when the application of provisions of labour laws, which are beneficial in
nature and in both cases, the consideration may entirely vary. The Court cannot apply the same yardstick while applying the term ''moral turpitude''
in respect of a person, who had involved in criminal case, where the act or behaviour of such person may lead to a conviction, which could shock
the moral conscience of society in general and by that act having been committed, the perpetrator would be considered to be of a depraved
character or a person who was to be looked down upon by the society. The very same yardstick cannot be applicable in respect of all proved
misconducts. There may be cases where an employee is found to be misbehaved with a woman worker and for that misconduct, if he is found
guilty and punishment is imposed, certainly such act or behaviour of the employee would amount to tell upon his moral turpitude. Whether the same
principle would be applicable to a case where there is falsification of records and correspondingly accepting bribe from the customers, for it to be
considered as an act or behaviour of a moral turpitude. In our opinion, it cannot be. In this context, we may also refer to the judgment of the
Bombay High Court in Jaysing Rangarao Raut Vs. Maharashtra State Electricity Board and Another, , wherein it has been held as follows:
The term ''moral turpitude'' by its very nature is somewhat nebulous because it involves an examination of an action in the light of the prevailing
moral norms. Unlike legal norms, moral norms are somewhat nebulous. They can vary from time to time, from society to society and even from
individual to individual. Hence it is quite possible that an action which may be violative of moral norms in one society may appear acceptable to
another society. Hence one can only judge the action in any given case in the light of what one considers to be the prevailing moral norms of the
society in which such in action has taken place. Secondly, action should involve turpitude. Hence, the action should not merely be contrary to
moral norms but it should involve a violation of the moral code in such a manner that it indicates baseness or depravity of the character.
8. Mr. V. Karthick, learned Counsel for the respondents would rely upon the judgment in Superintendent Engineer v. Presiding Officer, Labour
Court 2004 3 L.L.N. 588. In our opinion, the said judgment cannot be made applicable to the facts of this case. That was a case where the
employee involved in the alleged offence under the provision of ''Suppression of Immoral Traffic in Women and Girls Act, 1956 (now renamed as
the Immoral Traffic (Prevention) Act, 1956). Hence, this Court held that it is an offence against the society and the social and moral values. As we
already observed, such a misconduct or behavivour could be construed to be an offence involving moral turpitude. Hence, in the given facts and
circumstances of the case, we do not find that the falsification of accounts and the corresponding monetary gain earned by the petitioner would, in
any way, be considered to be a moral turpitude for the purpose of depriving his right for payment of gratuity in terms of Section 4(6)(b)(ii) of the
Act.
9. In this context, we may also refer that the object of labour laws, a social welfare legislations, is to afford certain basic entitlements and
consequent protection. Such laws cast upon the employer certain obligations for meticulous, impeccable and timely compliance. The law entitles an
employee to the benefits which he must receive from the employer unless restricted. The Payment of Gratuity Act is a welfare legislation to provide
a scheme for payment of gratuity to all types of employees engaged in the establishments employing ten or more employees. In terms of Sub-
section (1) of Section 4, 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, on his superannuation, or on his retirement or resignation, or on his death or disablement due to accident or disease.
Nevertheless, Sub-section (6) of Section 4 is somewhat an exemption for the restriction imposed for payment of gratuity in respect of an employee
on termination. The legislature with a clear intention has laid down the provision of Sub-clause (a) to Sub-section (6) of Section 4 empowering the
employer to forfeit the gratuity of an employee to the extent of the damage or loss so caused in the event the service of such employee is
terminated for any act, wilful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer.
Likewise, as per Clause (b) of the said provision, the gratuity is payable to an employee may be wholly or partially forfeited, (i) if the services of
such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part and (ii) if the services of such
employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him
in the course of his employment.
10. As far as the second limb of Sub-clause (ii) of Clause (b) to Sub-section (6), viz., the proved misconduct should be in the course of the
employment, there is no dispute. As far as the first limb, viz., whether the act constitutes an offence involving moral turpitude, it may be mentioned
that for the falsification of accounts and the consequential financial gain, the respondent had not made any prosecution in order to put against the
petitioner for having committed an offence, as the respondent had chosen to proceed only with the departmental enquiry against the petitioner.
Even otherwise the proved misconduct should be considered on facts to facts basis to find out as to whether such misconduct would be ""moral
turpitude"". In the present case, the allegation is only falsification of accounts and thereby making some financial gain. In view of our above
discussion and keeping the facts of this case in mind, we are of the opinion that the respondent cannot apply the provision of Section 4(6)(b)(ii) of
the Act to deny the gratuity to the petitioner. To this extent, we do not find any justification to interfere with the order in the writ petition.
11. As far as the writ appeal filed by the petitioner himself regarding the denial of interest, we may point out that the discrepancies relating to the
receipt of empty cylinders which led to the falsification of accounts came to light during March 1990. Within a period of four months, a charge
sheet was issued on 17.7.1990; an enquiry was completed and a second show cause notice was issued on 22.8.1991 and final order of dismissal
was passed on 10.9.1991. On the very same day, a show cause notice for forfeiture of gratuity was issued to the petitioner. The petitioner
submitted his explanation on 13.9.1991 and on 9.10.1991, an order was passed forfeiting the gratuity. The petitioner raised an industrial dispute in
I.D. No. 146 of 1992 challenging the order of termination and the matter was pending before the labour Court till the award was passed on
14.6.1994 for reinstatement. However, that award was immediately questioned by the respondent before this Court and the writ petition was
allowed and the award was set aside on 10.12.1994. The petitioner preferred an appeal questioning the order in the writ petition and the appeal
was dismissed on 19.11.1999. Thereafter, the petitioner went before the Supreme Court and the SLP was also dismissed on 10.4.2000.
Thereafter only, during May 2000, the petitioner filed an application for payment of gratuity without questioning the order dated 09.10.1991
forfeiting the gratuity. That application was rejected by the Controlling Authority on 29.11.2004 and the further appeal was also rejected on
26.12.2005 and thereafter, the writ petition was filed by the petitioner in the year 2006, which was allowed on 23.10.2008.
12. From the facts narrated above, it is clear that no delay can be attributed to the respondent, as the respondent had passed orders forfeiting the
gratuity as early as on 09.10.1991, which was ultimately set aside only on 23.10.2008 by this Court. Of course, Mr. V. Prakash, learned senior
counsel, would rely upon the judgment of the Madhya Pradesh Court in Ambika Charan Awasthy v. State of M.P. and Ors. 2003-I-L.L.J.-470,
wherein the Court had ordered 12% interest on the amount to be paid to the appellant therein. In that case, the Madhya Pradesh High Court
noticed that the entitlement of the appellant for payment of gratuity was made on 27.6.1997 and the same has not been implemented on the ground
that there was some administrative delay. Even when the same was brought to the notice of the concerned officers in the year 1999, such gratuity
was not paid. In spite of the repeated appeals, the officials slept over the matter till November, 1999 and therefore, the High Court found that the
delay was with the official respondents and therefore, the employee was entitled to interest.
13. In terms of Section 7 of the Act, the amount of gratuity should be determined on an application made by the employee to the employer
concerned. As per Rule 7 of the Payment of Gratuity (Central) Rules, 1972, an employee, who is eligible for payment of gratuity under the Act,
shall apply ordinarily within thirty days from the date the gratuity became payable in Form ''I'' to the employer. In terms of Rule 8, the employer
shall, within fifteen days from the date of receipt of the application, cause verification of the claim. Once it is found that the employee is entitled for
payment of gratuity, in terms of Rule 9, the amount shall be paid to the employee by way of demand draft or bank cheque to the employee,
nominee or legal heir. Only in the event there was a failure on the part of the employer in following the procedures laid down in Rules 8 and 9 and
there is a delay on their part, the provision of Section 7(3A) of the Act relating to the payment of interest may be put forth by the employee.
14. The facts, which we have narrated above, would disclose that the employer had, in fact, entertained the application, but rejected the same in
time. That order forfeiting the gratuity was questioned and ultimately, only by the order challenged in these writ appeals, the claim of the petitioner
for payment of gratuity was accepted. In the judgment relied upon by Mr. Prakash, learned senior counsel, in H. Gangahanume Gowda Vs.
Karnataka Agro Industries Corpn. Ltd., , of course, the Apex Court has held that there was no discretion left to the employer to deny the interest
to the employee on belated payment of gratuity in terms of Section 7(3A) of the Act. But, that judgment is of no use to the petitioner on the given
facts of the case. Hence, we are of the view that the writ appeal questioning the denial of interest must also fail.
15. For the foregoing reasons, both the writ appeals are dismissed. No costs. Consequently, connected M.P. is also dismissed.