Isabella Mariam

The High Court of Kerala Single Bench of Justice Gopinath P. held that a High Court can exercise its writ jurisdiction under Article 226 of the Constitution to quash an order passed by a State-appointed Controlling Authority on a gratuity claim, where that authority lacked jurisdiction to adjudicate the matter. The Court was considering a petition filed by a finance company operating branches across multiple states, challenging an order passed by a State Government-appointed authority determining the gratuity entitlement of a former employee. The Court found that for establishments with presence in more than one state, only the Controlling Authority appointed by the Central Government holds the competence to decide such claims, and that an employer's failure to raise a jurisdictional objection before the authority does not cure the inherent lack of jurisdiction.

The writ petition was filed challenging proceedings of the Controlling Authority under the Payment of Gratuity Act, 1972, determining the gratuity claim of the second respondent for service rendered with the petitioner establishment. The petitioner contended that it is an establishment having branches in more than one State and, therefore, the competent authority to adjudicate the gratuity claim was the Controlling Authority appointed by the Central Government, not the State Government. It was further submitted that the second respondent had rendered service in the Theni branch situated in Tamil Nadu, reinforcing the contention regarding jurisdiction.

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The second respondent argued that the petitioner had not raised the objection regarding jurisdiction before the Controlling Authority and that, in light of an earlier unreported judgment, such failure was fatal. It was also contended that the petitioner had an effective alternative remedy and should not have approached the High Court under Article 226 of the Constitution of India.

The Court considered the provisions of Section 2(a) and Section 2(d) of the Payment of Gratuity Act, 1972, along with the pleadings and the materials placed on record.

The Court observed, “in the light of the provisions contained in Section 2(a) of the 1972 Act read with the definition of 'Controlling Authority' under Section 2(d) of the 1972 Act and since it is admitted that the petitioner is an establishment having branches in more than one State, the Controlling Authority competent to consider any claim for payment of gratuity by any employee of the petitioner would be the Controlling Authority appointed by the Central Government and not the State Government.” It further recorded, “The 1st respondent, who decided the claim of the 2nd respondent, is admittedly an authority appointed by the State Government and therefore he had no jurisdiction to decide the claim of the 2nd respondent.”

On the objection regarding failure to raise jurisdiction earlier, the Court stated, “The contention raised by the counsel for the respondent in this case, in light of the judgment of this Court in W.P (C) No.11133/2021, is untenable.” It also observed, “The said judgment proceeds on its own facts. The judgment cannot be held as laying down any binding precedent.”

Addressing the issue of consent and jurisdiction, the Court recorded, “it is settled law that jurisdiction cannot be conferred by consent, and even a party's consent cannot confer jurisdiction where none exists and the jurisdiction to pass a particular order must be found from the provisions of the statute itself.”

The Court further noted, “Even the petition filed by the 2nd respondent indicates that the 2nd respondent had served the petitioner's establishment in its branch at Theni, which is situated in Tamil Nadu.” It added, “Going by the provisions of Section 2(a) read with the provisions of Section 2(d) of the 1972 Act, the 1st respondent ought to have concluded, after noticing the said averment of the 2nd respondent, that he had no jurisdiction to consider the claim for payment of gratuity.” Consequently, it observed, “Thus, the failure of the petitioner to object to maintainability is not fatal.”

On the alternative remedy, the Court stated, “it is settled law that where an order is challenged on account of lack of jurisdiction, the existence of alternative remedy is not a bar for the exercise of jurisdiction under Article 226 of the Constitution of India.”

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The Court directed, “Accordingly, this writ petition is allowed. Exts.P7 and P8 orders are quashed. It is made clear that this will not prevent the 2nd respondent from raising his claim before the Controlling Authority appointed by the Central Government. If such a claim is raised by the 2nd respondent before the Controlling Authority appointed by the Central Government, the said authority will decide on such application without undue delay.”

Advocates Representing the Parties

For the Petitioners: Sri. Jolly John, Smt. Liza Meghan Cyriac, Smt. C.S. Reshmi, Shri. Rubin Shibu, Smt. Tania Maria Joy

For the Respondents: Sri. T.R. Jagadeesh, Shri. Adi Narayanan, Shri. Jose Job; Sri. V.K Sunil (Government Pleader)

Case Title: M/s. Kosamattam Finance Ltd. v. Deputy Labour Commissioner & Anr.

Neutral Citation: 2026: KER:11529

Case Number: W.P (C) No.34801 of 2025

Bench: Justice Gopinath P.