Payment of Gratuity Act Ppt

7/29/2019 Payment of Gratuity Act Ppt

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IntroductionThe Payment of Gratuity Act 1972 is a socialsecurity enactment. It is derived from the word

gratuitous, which means gift or present.However, having being enacted as a socialsecurity form, it ceases to retain the concept of agift but it has to be seen as asocial obligation by an employer towards hisemployee.


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Section 1: Application and

commencement.The Payment of Gratuity Act 1972 applies to thewhole of India and so far as it relates to ports and

plantations it does not apply to the State of Jammuand Kashmir.It applies to:

(a) every factory, mine, oilfield, plantation, port

and railway company.(b) Every shop or establishment


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Section 2: Definitions

(a)"appropriate Government"

(b) "completed year of service (c)"employee"(d)"employer"(e)"family"(f)"retirement"(g)"wages"(h)Superannuation


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Section: 2AContinuous service.

Uninterrupted service

Where an employee employed in a seasonalestablishment


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Section 3- Controlling AuthorityThe appropriate Government may, bynotification, appoint any officer to bea controlling authority, who shall beresponsible for the administration of this Act and different controlling

authorities may be appointed for different areas.


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Section 4: Payment of gratuity

Gratuity shall be payable to an employeeon the termination of his employment after

he has rendered continuous service for notless than five years, -(a) on his superannuation, or (b) on his retirement or resignation, or (c) on his death or disablement due toaccident or disease


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Section 4 A: Compulsory Insurance

Insured by LIC

ExemptionRegistrationCompulsory payment of premium

Punishment


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Section 5: Power to exempt The appropriate Government i.e.

State Government or Central Government may (as thecase may be) exempt anyestablishment, factory, mine, oilfield,

plantation, port, railway company or shop from the application of this Act

by notification.


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Section 6: Nomination

Each employee, who has completed one year of service, shallmake nomination for to receive the amount of gratuity.

In his nomination, an employee may, distribute the amount of gratuity payable to him amongst more than one nominee.

If at the time of making nomination he has already family, he cannot make nomination in favour of a person who is not a member of his family. If he does so it shall be void.

Fresh nomination in favour of one or more members of his familyis required where he has not family at the time of makingnomination.

If a nominee predeceases the employee, the interest of thenominee shall revert to the employee who can make a freshnomination.

Every nomination, fresh nomination or alteration of nomination,as the case may be, shall be sent by the employee to his employer,who shall keep the same in his safe custody.


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Section 7: Determination of the amount of gratuity.

A person who is eligible for payment of gratuity shall senda written application to the employer.

The employer shall determine the amount of gratuity andgive notice in writing to the person to whom the gratuity is

payable and also to the controlling authority specifying theamount gratuity so determined as soon as gratuity becomes

payable and whether or not an application has been made bythe concerned employee.

The employer shall arrange to pay the amount of gratuitywithin 30 days from the date it becomes payable.

How to calculate the Amount of Gratuity


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Section 7A and 7B

Section 7A: Inspectors

Section 7B: Powers of Inspectors


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Section 8:Recovery of gratuity

From the collector, after givingopportunity to the employer

showing cause

Interest amount should notexceed the amount of gratuity


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Section 9: Penalty

Knowingly making false statement/ falserepresentation to avoid to make payment imprisonment up to 06 months, or with fine which

may extend to Rs.10,000/- or with both.

Breach, or makes default in complying with anyof the provisions of this Act imprisonment for 03 months to 01 year, or with fine which shall not

be less than Rs.10,000/- but which may extend toRs.20,000/- or with both.

Non-payment of any gratuity imprisonment6 months to 02 years + a fine.


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Section 10: Exemption of employer f rom l iabil i ty in cer tain cases.

If Employer proves:

(a) that he has used due diligenceto enforce the execution of thisAct, and

(b) that the said other personcommitted the offence inquestion without his knowledge,

consent or connivance


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Section 11:Cognizance of offences

(1) No court shall take cognizance of any offence punishable under this Act , Provided that where the amount of gratuity has not

been paid, or recovered, within six months from the expiry of the prescribed time, whereupon the controlling authority shall,within fifteen days from the date of such authorization, makesuch complaint to a Magistrate having jurisdiction to try theoffence.

(2) No court inferior to that of a Metropolitan Magistrate or aJudicial Magistrate of the first class shall try any offence

punishable under this Act.


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Section 12: Protection of action taken in good faith.

No suitor other legal proceeding shall lieagainst the controlling authority or anyother person in respect of anything whichis in good faith done or intended to be doneunder this Act or any rule or order madethere under.


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Section 13:Protection of gratui ty

No gratuity payable under this Act and nogratuity payable to an employee employedin any establishment, factory, mine,

oilfield, plantation, port, railway companyor shop exempted under section shall beliable to attachment in execution of anydecree or order of any civil, revenue or

criminal court.


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Section 14:

Act to override other enactments

The provisions of this Act or any rule madethere under shall have effectnotwithstanding anything inconsistenttherewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of anyenactment other than this Act.


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Section 15: Power to make rules

Central Government along with the houseof parliament has the right to make therules.


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Amendments

Government proposal to raise income taxexemption limit for gratuity funds from Rs 3.5

Lakh to Rs 10 Lakh. Trade unions , Ficci and Industry support List of amending Acts:1. The Payment of Gratuity (Amendment) Act, 1984 (25 of 1984).

2. The Payment of Gratuity (Second Amendment) Act, 1984 (26 of 1984).

3. The Payment of Gratuity (Amendment) Act, 1987 (22 of 1987).

4. The Payment of Gratuity (Amendment) Act, 1994 (34 of 1994).

5. The Payment of Gratuity (Amendment) Act, 1998 (11 of 1998)


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Forms

semester 3\IR\form-NOR.doc
http://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.dochttp://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.dochttp://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.dochttp://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.dochttp://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.dochttp://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.dochttp://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.dochttp://localhost/var/www/apps/conversion/tmp/scratch_4/semester%203/IR/form-NOR.doc

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Payment of Gratuity Act Ppt

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