N.L.TIBREWAL, J. - (1.) A short but important question is raised in both the petitions. The question is: Whether payment of gratuity to the employees of aided educational institutions in pursuance of Rule -82 of the Rajasthan Non -Government Educational Institutions (Recognisation, Grant -in -Aid and Service Conditions Etc.) Rules. 1993 (hereinafter to be referred to as the Rules) is an approved expenditure for the assessment of grant -in -aid? In other words, whether an aided educational institution is entitled to get proportionate grant -in -aid admissible to it under the Rules on the amount paid to its employees towards gratuity?
(2.) THE State Government vide its communication dated May 26, 1994. to the General Secretary, Managing Committee, Shri Agrawal College, Jaipur, has taken the view that payment of gratuity to an employee of the institution is not included in approved expenditure, as such, no grant -in -aid is payable on it. The decision on the question is likely to have far reaching consequences, having its effect on thousands of aided educational institutions in Rajasthan, extensive arguments were heard from both the sides. Shri N.K. Maloo, learned Counsel appearing for the petitioners, strongly contended that Rule -82 imposes a statutory obligation on all the aided educational institutions in Rajasthan to pay gratuity to their employees as admissible under Payment of Gratuity Act, 1972 with no discretion left to them, as such, payment towards gratuity cannot be treated as un -approved expenditure to be born by the Management only. In support of this contention, stress is laid on Note II appended to Rule -14. It was further contended that Rule 14 describes items to be included in approved expenditure, but they are not exhaustive and by inserting Rule -82, the scheme of gratuity stands approved by the Government. It was then contended that expression 'salary' as defined in Rule -2 (r) should be given wider connotation so as to treat the amount of gratuity paid to an employee as emoluments. This interpretation is necessary, contended by Shri Maloo, as payment towards gratuity is made to an employee as per government instructions and statutory obligation.
(3.) ON the other hand, learned Counsel appearing for the State of Rajasthan, defended the decision of the State Government excluding gratuity amount from approved expenditure for the purpose of grand -in -aid. It was contended that the management of an institution is primarily responsible to pay salary and other benefits including the amount of gratuity, to its employees and it cannot take the plea that unless and until State compensates by contributing towards gratuity, it will not make payment to its employees. Learned Counsel further contended that it is a matter of policy decision by the State Government whether aided educational institutions should be given grant -in -aid on the gratuity and till such decision is taken administratively or by framing statutory regulations, the State Government cannot be made liable to pay grant -in -aid towards gratuity.;