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Service & Administrative LawSupreme Court of India

Ashok Kumar Dabas (Dead through Legal Heirs) vs. Delhi Transport Corporation

Not available · 2025 INSC 1404Decided 9 Dec 2025
Not available
Justice Rajesh Bindal · Justice Manmohan

Background

Ashok Kumar Dabas, a conductor with Delhi Transport Corporation (DTC) since 1985 who had opted into a new pension scheme in 1992, resigned in 2014 citing family circumstances. His later request to withdraw the resignation was refused, and when he sought his retiral dues (gratuity, provident fund, leave encashment and pension), DTC informed him he was entitled only to provident fund and nothing else. The Central Administrative Tribunal and the Delhi High Court both upheld DTC's denial of the other benefits, and his legal heirs (he had since died) pursued the matter to the Supreme Court.

Decision Breakdown

The Court held that under Section 4 of the Payment of Gratuity Act, 1972, an employee who has completed five years of continuous service is entitled to gratuity upon resignation, retirement, superannuation, death or disablement: resignation does not disentitle an employee to gratuity. Since DTC could not show any government notification exempting it from the 1972 Act, the denial of gratuity was unjustified. The Court partly allowed the appeal, holding the legal heirs entitled to gratuity and leave encashment (with 6% interest from the date of resignation), but denied family pension since that was not admissible for a resigned employee under the applicable pension rules.

Lesson Learnt

Resigning from a job does not forfeit an employee's right to statutory gratuity for completed years of service: gratuity under the 1972 Act is payable on resignation just as it is on retirement, unless the employer is specifically exempted by government notification.

Ashok Kumar Dabas (Dead through Legal Heirs) vs. Delhi Transport Corporation – Legal Case Shots | LegalAware