Sunday, 29 June 2014

Revision in Gratuity Limits-2009


  Source*  www.taxguru.in/finance  

Payment of Gratuity (Amendment) Act, 2009 – Amendment in section 2 and insertion of section 13A, Change in definition of employee

 Payment of Gratuity (Amendment) act, 2009 – amendment in section 2 and insertion of section 13A
An Act to further amend the Payment of Gratuity Act, 1972.
Be it enacted by Parliament in the Sixtieth Year of the Republic of India as follows:—

Short title and commencement
1. (1) This Act may be called the Payment of Gratuity (Amendment) Act, 2009.
(2) It shall be deemed to have come into force on the 3rd day of April, 1997.

2. In the Payment of Gratuity Act, 1972 (39 of 1972) (hereinafter referred to as ‘the principal Act’), in section 2, for clause (e), the following clause shall be substituted, namely:—
‘(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. After section 13 of the principal Act, the following section shall be inserted, namely:—
“13A. Validation of payment of gratuity – Notwithstanding anything contained in any judgment, decree or order of any court, for the period commencing on and from the 3rd day of April, 1997 and ending on the day on which the Payment of Gratuity (Amendment) Act, 2009, receives the assent of the President, the gratuity shall be payable to an employee in pursuance of the notification of the Government of India in the Ministry of Labour and Employment vide number S.O. 1080, dated the 3rd day of April, 1997 and the said notification shall be valid and shall be deemed always to have been valid as if the Payment of Gratuity (Amendment) Act, 2009 had been in force at all material times and the gratuity shall be payable accordingly:
Provided that nothing contained in this section shall extend, or be construed to extend, to affect any person with any punishment or penalty whatsoever by reason of the non-payment by him of the gratuity during the period specified in this section which shall become due in pursuance of the said notification.”.

Related Post:-

LIC has only given a list of 45 ex-employees (2010) whose arrears' payments have been repudiated. On an average, about 4.5 crores have been denied as Gratuity payment for these employees. 

As stated in my first post, this repudiation of arrears and difference in Statutory benefits like Gratuity and Provident Fund has been going on since August 1997. This amount will run into billions of rupees.

Besides, the number of resigning employees since 1997 who have been denied arrears' and other Statutory Retirement Benefits; in spite of being on the rolls of the Corporation, as on the date from which revised payments were applicable; will itself be in thousands.

How has LIC of India accounted for this unpaid but payable amount in its Financial Statements? Has it even been accounted for?
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