Gratuity payment

mukesh Gupta (Querist) 27 November 2014 This query is : Resolved
1. Is it permissible under law if the amount of gratuity exceed from the ceiling limit of Rs. 10 Lakhs in a case where a persons has claimed gratuity from the different employers for the period he has worked?

OR
In other words the maximum limit of Rs 10 lakh is for entire service career or for each employment.

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Guest (Expert) 27 November 2014
The overall limit is Rs.10 Lakhs from all sources during entire service, even if worked in different organizations. If paid by any organization beyond overall limit, as of some better terms of employment extended by the employer, that is taxable.

Rajendra K Goyal (Expert) 27 November 2014
Agree with the expert PS Dhingra ji.

V R SHROFF (Expert) 27 November 2014
Agree with the expert PS Dhingra ji.

mukesh Gupta (Querist) 28 November 2014
Sir,

With all regards to the views of the experts.

But the Payment of Gratuity Act says that an employee is entitled for maximum gratuity to Rs. 10 Lakhs. Does it not mean that he ceases his status of an employee as soon he leave the employment of an employer. He becomes again an employee if joins other employer?

I am talking in a case where no such agreement/ contract for better gratuity is there.

regards.

Guest (Expert) 28 November 2014
Vague query! Any utility of your hypothesis? Better go through the relevant sections of the Act that would provide you the answer to your present hypothetical question.

However, if you have become entitled to a gratuity of Rs. 10 lakhs, you can feel free to leave the job. Why expect others to sit idle unnecessarily at home when they are able to put their energy constructively?

About your statement, "I am talking in a case where no such agreement/ contract for better gratuity is there," you may approach the Ministry of Law to amend the Act, as per your wishes.

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