Neeta Sawant WP 5649 of 2026

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CIVIL APPELLATE JURISDICTION

WRIT PETITION NO.5649 OF 2026

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Sanjay Santaram Karle ...Respondent

WRIT PETITION (ST) NO.28933 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Dattu Bali Misal ...Respondent

WRIT PETITION (ST) NO.28936 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Mahadev Krishna Chavan ...Respondent

WRIT PETITION (ST) NO.28938 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Suresh Bhagwan Vanave ...Respondent

WRIT PETITION (ST) NO.28939 OF 2025

_____________________________________________________________________________

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Neeta Sawant WP 5649 of 2026

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Vishnu Suresh Shinde ...Respondent

WRIT PETITION (ST) NO.28940 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Jyotiram Namdev Parlekar ...Respondent

WRIT PETITION (ST) NO.28945 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Ramdas Dinkar Pawar ...Respondent

WRIT PETITION (ST) NO.28966 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Maruti Nivrutti Malavadkar ...Respondent

WRIT PETITION (ST) NO.28971 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Balasaheb Bhimrao Kadam ...Respondent

_____________________________________________________________________________

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Neeta Sawant WP 5649 of 2026

WRIT PETITION (ST) NO.28972 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Hukum Eknath Sawant ...Respondent

WRIT PETITION (ST) NO.29020 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Dnyandev Sopan Kadam ...Respondent

WRIT PETITION (ST) NO.29022 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Balu Bhujaba Danane ...Respondent

WRIT PETITION (ST) NO.29023 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Vitthal Kisan Sutar ...Respondent

WRIT PETITION (ST) NO.29025 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

_____________________________________________________________________________

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Neeta Sawant WP 5649 of 2026

V/s.

Raghunath Mahadev Lokhande ...Respondent

WRIT PETITION (ST) NO.29026 OF 2025

Walchandnagar Industries Ltd. ...Petitioner

V/s.

Sanjay Pandhurang Sawant ...Respondent

Mr. Dhananjay Bhanage for the Petitioner.

Mr. Pankaj M. Patel for the Respondents.

CORAM: SANDEEP V. MARNE, J.

RESERVED ON: 22 JULY 2026

PRONOUNCED ON: 29 JULY 2026

JUDGMENT:

1) These petitions are �led by the Petitioner-Walchandnagar

Industries Limited (Employer) challenging the judgments and orders

passed by the Appellate Authority under the Payment of Gratuity Act,

1972 (PG Act) and the Industrial Court dismissing the Appeals preferred

by it and con�rming the orders passed by the Controlling Authority and

Labour Court, Pune. Both Controlling and Appellate Authorities have

upheld the entitlement of Respondent in each Petition to receive gratuity

from the Petitioner in respect of the services rendered by them.

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Neeta Sawant WP 5649 of 2026

2) Petitioner is an incorporated entity engaged in the activities

of engineering, project management, and manufacturing of machinery

and equipment relating to nuclear power, aerospace, defense, oil and gas,

steam generation, cement, sugar etc. Petitioner has developed a township

in Indapur Taluka of Pune District known as Walchandnagar and looks

after civic infrastructure, educational and healthcare needs of the said

township. Petitioner apparently issues contracts to different agencies for

looking after the civic infrastructural work of the township.

3) Respondent in each Petition claimed that they were

employed by the Petitioner and �led applications claiming gratuity in

respect of the services rendered by them with the Petitioner. They �led

individual applications against the Petitioner under Section 7 of the PG

Act before the Controlling Authority and Labour Court, Pune claiming

gratuity from the Petitioner. Petitioner resisted the applications denying

existence of employer-employee relationship. The Controlling Authority

has allowed the applications preferred by the Respondents and has issued

directions to the Petitioner to pay the quanti�ed amount of gratuity to

each of them with interest @ 10% p.a. from the date of retirement.

Aggrieved by the orders passed by the Controlling Authority, Petitioner

�led Appeals before the Appellate Authority. The Appellate Authority has

dismissed the Appeals but has effected minor changes in the

quanti�cation of amounts of gratuity payable to the Respondents.

Petitioner is aggrieved by the orders passed by the Controlling and

Appellate Authorities and has �led the present Petitions.

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Neeta Sawant WP 5649 of 2026

4) Mr. Bhanage the learned counsel appearing for the Petitioner

has submitted that the Controlling and Appellate Authorities have grossly

erred in upholding the claims of Respondent for gratuity. That there is

absolutely no employer-employee relationship between the Petitioner

and the Respondents. That Respondents did not lead any evidence to

establish such employer-employee relationship. That the Controlling and

Appellate Authorities have erroneously imported the concept of ‘principal

employer’ which is unknown to the provisions of the PG Act. That there

is no liability on the principal employer under the PG Act to pay gratuity

to the contract workers. That liability to pay gratuity to the workers is on

the contractor. That therefore person claiming gratuity must prove

existence of direct employer-employee relationship. That in the present

case, there is no material on record to infer any direct employer-employee

relationship between the Petitioner and the Respondents. He relies on

judgment of this Court in Indian Institute of Technology, Bombay vs.

Tanaji Babaji Lad and Ors.

1

in support of his contention that there needs

to be direct supervision and control by the company on the activities of

workers of the contractor. He also relies on judgment of this Court in

Cummins (I) Ltd. vs. Industrial Cleaning Services and Others

2

. He also

relies on judgment of Kerala High Court in Cominco Binani Zinc Ltd. vs.

Pappachan

3

in support of his contention of distinction between the

provisions of Contract Labour (Regulation and Abolition) Act, 1970

(CLRA) and the PG Act.

12024 DGLS Bom 4267

22017 (3) Mh.L.J. 294

3O.P. 10914 of 1984 decided on 28 November 1988

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Neeta Sawant WP 5649 of 2026

5) Mr. Bhanage further submits that the Controlling and

Appellate Authorities have erroneously considered the factum of

Provident Fund deduction for assuming existence of employer-employee

relationship. He submits that mere deposit of Provident Fund does not

automatically establish employer-employee relationship. He submits that

in a given case, a principal employer may pay Provident F und

contribution in respect of workers of the contractor. However, the same

does not ipso facto establish direct employer-employee relationship

between the duo for the purpose of applicability of provisions of PG Act.

In support, he relies on judgments of this Court in Milind Nandkumar

Kularni Versus. Kirloskar Ebara Pumps Ltd.

4

and judgment of Madras

High Court in Petroleum Workers Union and Ors. vs. Hindustan

Petroleum Corporation Limited and Ors.

5

6) Mr. Bhanage further submits that gratuity is payable only in

respect of completed years of service. That therefore Respondents ought

to have proved completion of 240 days of service in each year. That mere

broken spells of service do not make a person entitled for payment of

gratuity. In support, he relies on judgment of Division Bench of this Court

in Bombay Union Dyeing and Bleaching Mills vs. Narayan Tukaram

More and Anr.

6

Mr. Bhanage accordingly prays for setting aside the

impugned orders passed by the Controlling and Appellate Authorities.

7) The Petitions are opposed by Mr. Patel, the learned counsel

appearing for the Respondents. He submits that speci�c admissions are

42024 3 Bom CR 31

52004 3 LLJ 100

61979 Supreme (Bom) 268 : 1980 2 LLJ 424

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Neeta Sawant WP 5649 of 2026

given by witness of Petitioner about Respondents being the employees of

the Petitioner. That there are admissions of direct payment of salary by

the Petitioner to the concerned employees. He therefore submits that

Petitioner now cannot seek to question the correctness of �ndings of fact

arrived at by Controlling and Appellate Authorities after taking into

consideration the said admissions. So far as payment of Provident Fund

contributions are concerned, Mr. Patel submits that contributions are

paid with the same Code Number as is applicable to regular employees.

Had Respondent been workers of the Contractor, Provident Fund

contributions would have been made under a different Code Number.

That the Controlling and Appellate Authorities have assessed the

evidence on record and have thereafter recorded �ndings of fact. That

concurrent �ndings of fact establishing direct employer-employee

relationship cannot be questioned by the Petitioner before this Court in

exercise of jurisdiction under Article 227 of the Constitution of India.

That Respondents are granted statutory gratuity by the impugned orders

and that there is no warrant for interference in the orders passed by the

Controlling and Appellate Authorities. He prays for dismissal of the

Petitions.

8) Rival contentions urged on behalf of the parties now fall for

my consideration.

9) Petitioner is aggrieved by the orders passed by the

Controlling and Appellate Authorities upholding the claim of the

employees for gratuity. Respondents’ claim for gratuity is disputed by the

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Neeta Sawant WP 5649 of 2026

Petitioner mainly disputing existence of employer-employee relationship.

Petitioner took a stand before the Controlling Authority that Respondents

are not its employees. In support of its defence that there is no employer-

employee relationship, Petitioner examined its witness, Shri. Abhijit

Nandkumar Mirge. The witness of the Petitioner has given series of

admissions, which clearly destroys the case of the Petitioner. He

speci�cally admitted that Shri. Sanjay Santaram Karle was the employee

of the Petitioner. He has further admitted that salary of Shri. Karle was

deposited by the Company. In cross-examination, when he w as

questioned about the Provident Fund Code, he could not depose as to

whether two separate Codes were maintained for employees and contract

workers. On the other hand, it got proved that Provident Fund code of the

Petitioner for paying contributions of permanent employees and

contributions of Respondents is the same. The Provident Fund Code is

also the same, MH-9825. Petitioner who took a defence of Respondents

being contract employees did not �le copies of contracts executed with

the contractors. Thus, the evidence before the Controlling Authority was

such that it was left with no other alternative but to record �nding of

existence of employer-employee relationship. The Controlling Authority

has made an in-depth analysis of the evidence on record. By no stretch of

imagination can the said analysis be branded as perverse. The ultimate

conclusion recorded by the Controlling Authority about Respondents

being employees of the Petitioner is well supported by the evidence on

record.

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Neeta Sawant WP 5649 of 2026

10) The Petitioner challenged the �ndings of the Controlling

Authority in appeal before the Appellate Authority. The Appellate

Authority has marshalled through the evidence once again and has

upheld the �ndings of the Controlling Authority about Respondents being

the employees of the Petitioner. The Appellate Authority has taken into

consideration the factum of payment of wages as well as Provident Fund

contributions by the Petitioner. Petitioner was unable to demonstrate an

element of perversity in the �ndings recorded by the Controlling

Authority and Appellate Authority.

11) The issue of existence of employer-employee relationship

requires factual enquiry by taking into consideration the evidence on

record. The factual enquiry is conducted by the Controlling Authority by

assessing the evidence on record. The Appellate Authority has re-

appreciated the evidence and has concurrently upheld the �ndings of the

Controlling Authority. Even before me, Mr. Bhanage has been unable to

point out any element of perversity.

12) Mr. Bhanage has strenuously contended that the Controlling

Authority has erroneously borrowed the concept of ‘principal employer’

under CLRA for the purpose of establishing employer-emplo yee

relationship. I am unable to agree. In fact, the Petitioner has miserably

failed to prove before the Controlling Authority by leading cogent

evidence that any contracts were executed with particular contractors or

that Respondents were contract employees. Apart from Petitioner’s

failure to prove existence of contract, the Respondents established

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Neeta Sawant WP 5649 of 2026

payment of direct wages as well as deposit of Provident Fu nd

contributions by the Petitioner. In such circumstances, it cannot be

contended that the Controlling Authority has borrowed the concept of

principal employer under CLRA. The Controlling Authority has not

fastened the liability for payment of gratuity by upholding the status of

Petitioner as the principal employer. On the other hand, the Controlling

Authority has recorded positive �ndings of existence of direct employer-

employee relationship between the parties.

13) Mr. Bhanage has relied upon judgment of this Court in

Cummins India Ltd. (supra). In that case, this Court has held that the

ultimate control over the affairs of the concerned workers was that of the

contractor. They were merely designated to work inside the factory

premises of the Petitioner therein. This Court therefore held that the

Petitioner therein was not liable to pay gratuity to such contract workers.

The judgment has no application to the facts of the present case where

Petitioner has failed to establish existence of any contract and more

importantly, payment of salaries and Provident Fund contributions

directly by the Petitioner is established. There are also direct admissions

of Petitioner's witness about existence of employer-employee

relationship.

14) Mr. Bhanage has also relied upon judgment of this Court in

Indian Institute of Technology vs. Tanaji Babaji Lad (supra), which

judgment, far from assisting the case of the Petitioner, actually militates

against it. In that case, the contract workers had continued with the

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Neeta Sawant WP 5649 of 2026

establishment for a considerable period of time and through various

contractors. Though contractors were changed, the workers continued in

service. In the facts of that case, this Court held that the ultimate control

and supervision over them for over 4 decades was with the Petitioner-IIT.

In the present case as well similar situation exists where Respondents

have worked with the Petitioner for a considerable time and even if the

story of Petitioner about engagement through contractors is to be

believed, the case involves continuance in service with change of

contractors. In my view therefore, the judgment does not assist the case

of the Petitioner in any manner and on the other hand, the ratio thereof

applies in favour of the Respondents.

15) Mr. Bhanage has strenuously contended that mere

contributions made by the Petitioner towards Provident Fund of the

Respondents cannot be a factor relevant to be taken into consideration

for determining their entitlement for gratuity. He has relied upon

judgment of this Court in Milind Nandkumar Kulkarni (supra) in support

of his contention that deposit of Provident Fund contribution is not a

factor suf�cient for establishment of employer-employee relationship. In

that judgment, this Court has held in para-16 as under:

16. Though deduction of Provident Fund contribution by Respondent-Company

is highlighted for establishment of employer-employee relationship, this aspect

is suf�ciently explained. It appears that the contractors had engaged less than

20 workers and were not equipped with ‘Code’ for deposit of Provident fund

contributions and therefore the contractors used to deduct Provident Fund

contributions from the concerned workers and used to hand it over to

Respondent-Company for being deposited with the of�ce of Provident Fund.

This aspect is again admitted by one of the Petitioners in the cross-

examination. Therefore, mere deposit of Provident Fund contribution in respect

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Neeta Sawant WP 5649 of 2026

of Petitioners by Respondent-Company did not ipso facto made them direct

employees of the Respondent-Company.

16) Thus, in Milind Nandkumar Kulkarni, the contractor

concerned had engaged less than 20 workers and did not have a code for

deposit of Provident Fund contributions. The Contractor used to deduct

Provident Fund contributions from the concerned workers and used to

handover the same to the Respondent therein for being deposited with

the Provident Fund Authorities. In the present case, such kind of

situation is not involved and there is nothing on record to indicate that

the Petitioner deposited the Provident Fund dues of workers of

contractors only on account of absence of code with the concerned

contractor. Mr. Bhanage has also relied on the judgment of Madras High

Court in Petroleum Workers Union and Ors. Vs. Hindustan Petroleum

Corporation Ltd. (supra) in which it has been held in para-14 as under:

14. The further contention that the respondent/Corporation was paying

contribution to the employees provident fund and that the employees were

entitled to the provident fund, cannot also help the workers in any manner. The

liability to pay the employees provident fund is mandatory irrespective of the

nature of the employment. Under S. 2(f) of the Employees' Provident Funds Act,

1952, which de�nes the expression “employee” includes any employee by or

through a contractor in connection with the work of the establishment.

Therefore the liability to pay the provident fund would arise even in respect of

an employee under a contractor. Under S. 3-A(sic), the amount of contribution

paid or payable by the employer may be recovered by the employer from the

contractor either by deduction of any amount payable under the contract or as a

debt payable by the contractor. From the above provisions, it is clear that the

liability to pay the provident fund is mainly on the principal-employer and

thereafter it is open to the employer to recover from the contractor. Therefore

the fact that the petitioners are covered by the provident fund scheme, is not

relevant for deciding the status of the petitioners.

17) The issue before the Madras High Court was whether the

concerned workers were employees of the contractor or they were direct

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Neeta Sawant WP 5649 of 2026

employees of Hindustan Petroleum Corporation Ltd. The Madras High

Court has not conclusively held that the concerned workers are direct

employees of Hindustan Petroleum Corporation Ltd. but has issued

direction for making of Reference for deciding disputed questions of facts.

Therefore, the judgment cannot be read in support of an abstract

proposition that deposit of Provident Fund contributions by an entity is

an altogether irrelevant factor for deciding existence of employer-

employee relationship.

18) In pursuance of order passed by this Court on 15 September

2025, the Petitioner has �led an Af�davit dated 27 October 2025 giving

the the status of 15 Respondents. It would be relevant to reproduce Chart

set forth in the said Af�davit as under:

Writ

Petition

No.

Name of

Employee

Working

as

Name of

Contractor

Date of

joining

Date of

terminati

on

Remark

WP (St)

28940/2025

Jyotiram

Namdev

Parlekar

Helper

(IMD

Division)

M/s. Lakshmi

Spray Painting

1989 09/06/2017 This

contractor is

continued

WP (St)

29025/2025

Raghunath

Mahadev

Lokhande

Helper

(IMD

Division)

M/s.

Matoshree

Spray Painting

1988 12/07/2007 Earlier he

was working

with Bansode

contractor

WP (st)

29026/2025

Sanjay

Pandhurang

Sawant

Helper

(IMD

Division)

M/s.

Matoshree

Spray Painting

16/11/1995 31/10/2016 Contract

discontinued

WP (st)

28933/2025

Dattu Bali

Misal

Helper

(IMD

Division)

M/s. S. S.

Jadhav

1998 31/05/2012 Contract

discontinued

WP (st)

29022/2025

Balu Bhujaba

Danane

Helper

(IMD

Division)

M/s. Shankar

Engineering

1995 31/05/2015 Contract

discontinued

WP (st)

29020/2025

Dynandev

Sopan Kadam

Helper

(IMD

Division)

M/s. Lakshmi

Sray Painting

1989 31/05/2016 This

contractor Is

continued

WP (st)

28938/2025

Suresh

Bhagwan

Vanave

Helper

(IMD

Division)

M/s.

Matoshree

Spray Painting

1989 25/04/2014 Last he was

working with

Bansode

Contractor

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Neeta Sawant WP 5649 of 2026

WP (st)

29023/2025

Vitthal Kisan

Sutar

Helper

(IMD

Division)

M/s. B. N.

Kadam

01/02/1989 31/05/2018 This

contractor is

continued

WP (st)

28972/2025

Hukum

Eknath

Sawant

Helper

(IMD

Division)

M/s.

Bhagyashree

Fabricators

1988 30/09/2015 This

contractor is

continued

WP (st)

28939/2025

Vishnu Suresh

Shinde

Helper

(IMD

Division)

M/s. Lakshmi

Spray Painting

01/06/1988 30/11/2016 This

contractor is

continued

WP (st)

28966/2025

Maruti

Nivrutti

Malavadkar

Helper

(IMD

Division)

M/s. S. S.

Jadhav

06/10/1995 31/05/2018 Contract

Discontinued

WP (st)

28971/2025

Balasaheb

Bhimrao

Kadam

Helper

(IMD

Division)

M/s.

Matoshree

Spray Painting

1993 05/05/2016 Contract

Discontinued

WP (st)

28945/2025

Ramesh /

Ramdas

Dinkar Pawar

Helper

(IMD

Division)

M/s. Vikas

Fabricators

1995 31/05/2014 Contract

Discontinued

WP (st)

28944/2025

Sanjay

Santaram

Karle

Helper

(IMD

Division)

M/s. Shankar

Engineering

02/02/1996 15/12/2015 He himself

was

contractor

WP 9st)

28936/2025

Mahadev

Krishna

Chavan

Helper

(IMD

Division)

M/s. Lakshmi

Spray Painting

1989 28/02/2017 This

contractor is

continued

19) However, before the Controlling Authority, the Petitioner

apparently did not produce evidence of engagement of the Respondents

through contractor. It is therefore dif�cult to accept the bald statement

made in the additional Af�davit that the Respondents were engaged

through various contractors.

20) It must also be noted that the amount of gratuity directed to

be paid by the Petitioner is not exponentially high. The modi�ed amount

of gratuity ultimately directed to be paid by the Appellate Authority in

case of each of the Respondent is as under:

Writ Petition No. Name of Employee Gratuity directed to be

paid (in INR)

WP (St)

28940/2025

Jyotiram Namdev Parlekar 135692

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Neeta Sawant WP 5649 of 2026

WP (St)

29025/2025

Raghunath Mahadev Lokhande 33718

WP (st) 29026/2025 Sanjay Pandhurang Sawant 68469

WP (st) 28933/2025 Dattu Bali Misal 50225

WP (st) 29022/2025 Balu Bhujaba Danane 86068

WP (st) 29020/2025 Dynandev Sopan Kadam 130685

WP (st) 28938/2025 Suresh Bhagwan Vanave 70143

WP (st) 29023/2025 Vitthal Kisan Sutar 127505

WP (st) 28972/2025 Hukum Eknath Sawant 99332

WP (st) 28939/2025 Vishnu Suresh Shinde 136145

WP (st) 28966/2025 Maruti Nivrutti Malavadkar 105942

WP (st) 28971/2025 Balasaheb Bhimrao Kadam 88662

WP (st) 28945/2025 Ramesh / Ramdas Dinkar

Pawar

65267

WP (st) 28944/2025 Sanjay Santaram Karle 84284

WP (st) 28936/2025 Mahadev Krishna Chavan 120685

21) Respondents have been working for the Petitioner for a

considerable period of time. Some of them have worked since the year

1988. It is not possible to believe that somebody can work as a worker of

the contractor with the same principal employer for as many as 29 long

years. The Respondent in Writ Petition (St.) No. 29023 of 2025 (Vitthal

Kisan Sutar) has worked for the Petitioner from 1 February 1989 till 31

May 2018. He has rendered services for 29 long years for the Petitioner.

The information provided by the Petitioner would indicate that alleged

contractors have also changed. Thus, the situation prevailing in the

present case is almost identical to the one in Indian Institute of

Technology vs. Tanaji Babaji Lad (supra). Respondents cannot be

compelled to run behind multiple contractors for securing gratuity from

each of them. They have ultimately worked for a considerable period of

time. They are not expecting any bene�t other than gratuity from the

Petitioner. The amount of gratuity is also not exponentially high. In that

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Neeta Sawant WP 5649 of 2026

view of the matter, it cannot be concluded that any palpable error is

committed by the Controlling or the Appellate Authority in directing

payment of gratuity.

22) Considering the overall conspectus of the case, I am not

inclined to interfere in the impugned orders passed by the Controlling

and Appellate Authorities. The Writ Petitions are devoid of merits. They

are accordingly dismissed without any order as to costs.

[SANDEEP V. MARNE, J.]

23) After the judgment is pronounced, the learned counsel

appearing for the Petitioner requests for continuation of the ad-interim

order granted during pendency of the Petitions. The request is opposed by

the learned counsel appearing for the Respondent. Considering the

nature of �ndings recorded in the judgment, I am not inclined to continue

the stay. The request is accordingly rejected.

[SANDEEP V. MARNE, J.]

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PAGE NO.    17   of   17  

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NEETA

SHAILESH

SAWANT

Digitally

signed by

NEETA

SHAILESH

SAWANT

Date:

2026.07.29

20:30:04

+0530