1. The petitioner has filed the captioned writ petition contending that he had taken on lease a cashew processing unit owned by respondents 3 and 4, as evidenced by Ext.P1, for the period commencing from 01.01.2008. The petitioner submits that he continued to occupy and operate the said cashew processing unit until 31.07.2015.

2. The petitioner further states that the respondent employees instituted proceedings under the provisions of the Payment of Gratuity Act, 1972 (for short, "the Act") before the 2nd respondent, claiming gratuity benefits thereunder. In response, the petitioner filed Ext.P3 objection dated 18.07.2017. Upon adjudication, the 2nd respondent passed Ext.P4 order dated 29.10.2021, holding that the petitioner was liable to pay a sum of Rs.21,16,608/- towards gratuity.

3. Aggrieved by the said order, the petitioner preferred an appeal before the 1st respondent, as evidenced by Ext.P7. However, while filing the appeal, the petitioner admittedly did not comply with the mandatory pre-deposit requirement prescribed under Section 7 of the Act. Consequently, the petitioner also filed a separate application seeking exemption from the requirement of making the said pre-deposit.

4. By a communication dated 13.09.2022 (Ext.P8), the 1st respondent declined the petitioner's request to dispense with the mandatory pre-deposit. Consequently, the appeal preferred by the petitioner was rejected by Ext. P9 order dated 01.11.2022. It is in such circumstances, the petitioner has filed the captioned writ petition, seeking the following reliefs:

                  “1) Call for the records leading to Ext.P1 to P9.

                  2) Issue a writ of certiorari or any other appropriate writ or order to quash Exts.P4, P8 and P9 orders.

                  3) Issue a writ of mandamus or any other appropriate writ or order directing the Respondent No.1 to take Ext.P7 appeal filed by the Petitioner without insisting deposit of the amount shown in P4 common order or allowing the Petitioner to deposit the amount Rs.1,87,348/- shown in Ext.P5 and dispose of the appeal in accordance with law.

                  4) Issue a writ of Mandamus or any other appropriate writ or order directing the Respondents 1 to 25 to recover the entire gratuity amount mentioned in Ext.P4 less the amount shown in Ext.P5 from the property of the factory and the Owner.”

5. I have heard Sri. T.M. Chandran, the learned Counsel for the petitioner, as well as Sri. Murali Madanthacodu, the learned counsel for the party respondents herein. In spite of service of notice, there is no appearance from the side of respondent Nos.3 and 4 and they are set ex-parte.

6. Sri. Chandran, the learned counsel for the petitioner, would contend that:-

                  i) The liability of the petitioner, if any, can only extend to the period during which he was admittedly in possession of the cashew processing unit, as noticed earlier. He would rely on the judgment of a Division Bench of this Court in Kerala State Cashew Development Corporation v. Sarojini Amma [2000 (2) KLT 580] to contend that if at all there is any liability, that is only the pro-rata liability, with reference to the period during which the factory was in his possession.

                  ii) He also sought to rely on the principles laid down in Kamaladharan S. v. Managing Director, Kerala Shipping and Inland Navigation Corporation Ltd. [2024 (4) KHC 194] in support of this contention. The petitioner also places reliance on the provisions of Section 105 of the Transfer of Property Act, 1882, to contend that the lease under Ext.P1 was a conditional lease and, therefore, any liability, if at all, can only be determined on a pro rata basis.

                  iii) He further relies on the provisions of the Factories Act, 1948 (Section 2(n)), to contend that the "occupier" is to be regarded as the employer for the purposes of the Payment of Gratuity Act, 1972, being the person having ultimate control over the affairs of the factory.

                  iv) The petitioner further contends that there was no proper adjudication of the actual issues arising for consideration under Section 7(5) of the Payment of Gratuity Act, 1972.

7. Per contra, Sri. Murali, the learned counsel for the party respondents would content that:-

                  i) The principles laid down by the Division Bench of this Court in Kerala State Cashew Development Corporation (supra) have no application to the facts of the present case, as the said decision was rendered in the context of the specific provisions of the Cashew Factories (Acquisition) Act, 1974.

                  ii) The liability under the Payment of Gratuity Act, 1972 arises by virtue of the mandate contained in Section 4 thereof. There-fore, the petitioner, being the employer on the date of termination of the employees' services, is liable to satisfy the gratuity liability, if any.

8. I have considered the rival contentions as well as the connected records.

9. The first issue raised by Sri. Chandran that arises for consideration is whether the petitioner is entitled to claim apportionment of gratuity liability on a pro rata basis with reference to the involvement of respondents 3 and 4.

10. It is true that the Division Bench of this Court in Kerala State Cashew Development Corporation (supra) held that, in a case where a cashew factory was initially in the possession of the Kerala State Cashew Development Corporation and was subsequently restored to its original owner, the liability towards gratuity could be apportioned on pro rata basis. However, I am of the considered opinion that the said principle was laid down in the context of the specific provisions of the Cashew Factories (Acquisition) Act, 1974, as rightly contended by Sri. Murali. Section 10(4) of the Cashew Factories (Acquisition) Act, 1974 specifically provides for the liability of the Kerala State Cashew Development Corporation in cases where the management of a factory had been entrusted to it in the manner laid down therein. It was in the light of the said statutory provision that the Division Bench held that the liability under the Payment of Gratuity Act was liable to be apportioned on a pro rata basis between the parties concerned.

11. The contentions raised by Sri. Chandran with reference to the provisions of the Transfer of Property Act, 1882 and the Factories Act, 1948, in my opinion, are not germane to the issue arising in the present case, inasmuch as the Payment of Gratuity Act, 1972 is a self-contained legislation. It is true that Section 2(g) of the Payment of Gratuity Act, 1972 adopts the definition of the term "factory" as contained in Section 2(m) of the Factories Act, 1948. However, such adoption is only for the limited purpose of incorporating the definition of the expression "factory" and cannot be extended to import other provisions or concepts under the Factories Act for determining liability under the Payment of Gratuity Act.In such circumstances, I am of the opinion that the reliance placed on the provisions of the Transfer of Property Act as well as the Factories Act would not be of any assistance to the petitioner.

12. The real issue arising for consideration, in the afore circumstances, would be as regards the interpretation of the provisions of Section 4 of the Act, which would read as under:-

                  “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, or

                  (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:

                  Provided further that in the 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 a 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.”

                  (Underlining supplied)

                  Thus, gratuity becomes payable to an employee upon the termination of his employment, after he has rendered continuous service as prescribed under the Act.

13. In the case at hand, the party respondents instituted proceedings before the Controlling Authority (the 2nd respondent), contending that their services had been terminated and that they were consequently entitled to gratuity under the provisions of Section 4 of the Act.

14. In Ext.P4 order, reference has also been made to the objections filed by the petitioner herein. The proceedings were initially instituted by the party respondents only against the petitioner. In the objections filed by him, the petitioner contended that any liability, if at all, was that of respondents 3 and 4. Taking note of the said contention, respondents 3 and 4 were impleaded as additional respondents in the proceedings before the Controlling Authority.

15. In paragraph 4 of Ext.P4 order, the adjudicating authority has specifically recorded the contention of the petitioner that he was in occupation of the factory only during the period from 01.01.2008 to 31.12.2014. The further contention raised by the petitioner that as on the alleged date of termination of the party respondents - 31.12.2015 - respondents 3 and 4 were in control and management of the factory/processing unit, has also been specifically noticed in the said paragraph. However, the afore issue has not been specifically adjudicated and decided by the original authority.

16. In my opinion, it is only after adjudication of the aforesaid issue specifically raised by the petitioner, and upon determining the actual person liable as the employer for discharging the statutory obligations, that the final liability under Section 4 of the Act can be fixed.

17. In this regard, this Court also takes note of the provisions of Section 7 of the Act, which prescribes the procedure for determination of the amount payable under the Act. In my considered opinion, the said provision contemplates a preliminary inquiry as well as a detailed inquiry based on the respective contentions raised by the parties, before determination of the amount payable thereunder.

18. However, despite the specific contentions raised by the petitioner regarding the relevant period of possession and the dates in question, the same has not been adjudicated upon by the original authority.

19. On that basis, I am of the opinion that the matter requires a revisit at the hands of the original authority. Therefore, I dispose of this writ petition as under:-

                  1) Exts.P4 and P9 are set aside.

                  2) The 2nd respondent is directed to consider the mat-ter afresh with specific reference to the contentions raised by the petitioner as above and pass orders as ex-peditiously as possible, at any rate, within a period of three months from today.

                  3) Needless to say that the party respondents also require to be granted an opportunity of being heard in the matter.