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Am i eligible for gratuity?

Rajaram M (Asst. Manager Materials) (180 Points)

01 April 2015

I have completed 4 years and 9 months as of now. Generaly I hears that Gratuity eligibility is 5 years. Recently I am hearing from people that it is 4.5 year / 4.9 years or 4 years & 270 days.

Which one is correct & Am I eligible for Gratuity amount? Thank you in advance.

Regards

Rajaram M

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8 Replies

CMA Poornima Madhava (CMA) (13112 Points)
Replied 01 April 2015

You will be eligible for gratuity only if u complete 5 years of continuous service. In your case, as you have not completed 5 yrs, you may not be eligible.

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Vivek Venkataram (Just cleared CS(441/800) now C.A Final Attempt in May 2015) (772 Points)
Replied 02 April 2015

Clarity between gratuity eligibility service (5 or 4.8 yrs)? The gratuity eligibility service as per Gratuity Act 1972 is 5 years. But as per the judgment from Supreme Court below and the quotation from the book quoted below it seems that the gratuity eligibility service is 4 years 240 days. "Judgment from Supreme Court: "Yes, by virtue of the judgment of Supreme Court rendered under the provisions of the Industrial Dispute Act in Surendra Kumar Verma vs. Central Govt. Industrial Tribunal,[(1980) (4) S.C.C.433)], it is enough that an employee has a service of 240 days in the preceding 12 months and it is not necessary that he should have completed one whole years service. As the definition of continuous service in Industrial Dispute Act and Payment of Gratuity Act are synonymous, the same principal can be adopted under the act also and hence an employee rendering service of 4 year 10months 11days is considered to have completed 5 years continuous service under sec.4(2) and thereby is eligible for gratuity."

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Vivek Venkataram (Just cleared CS(441/800) now C.A Final Attempt in May 2015) (772 Points)
Replied 02 April 2015

If you have served 240 days in the 5th year it is considered as a full years service. ;) According to what i have posted. Hope this helps

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D S RAWAT (bussiness) (28 Points)
Replied 02 April 2015

gratuity needs five year continues service in one company. and second term is you are in payroll then you will eligible for gratuity

BHARATH KUMAR R (AVP CREDIT) (21 Points)
Replied 02 April 2015

Vivek is right. Supreme Court judgement has given clarity

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Rajaram M (Asst. Manager Materials) (180 Points)
Replied 02 April 2015

Thank you all. especially to Mr Vivek.

You have mentioned

"hence an employee rendering service of 4 year 10months 11days is considered to have completed 5 years continuous service under sec.4(2) and thereby is eligible for gratuity"

I have 4 years and 9 months without any break in the same company then it is 4 years & 270 days almost whereas you have mentioned 4 year 10months 11days which is still contrary to 4 years & 240 days.

Can you please clarify on this. Many thanks in advance

Regards

Rajaram

Vivek Venkataram (Just cleared CS(441/800) now C.A Final Attempt in May 2015) (772 Points)
Replied 02 April 2015

Dont worry about thay clause mr rajaram. That was regarding that particular case. The clause of final interest is It is enough that an employee has completed 240 days in the 5th year of service to be mentioned as 5 years service completed. Good to be of help to you. Do thank me by pressing the thanks button ;)

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