In Brief
An employee of a co-operative bank died in service. His widow, as legal heir, claimed his gratuity. The bank refused to pay because creditors had obtained court orders restraining disbursement due to the deceased's loan defaults. The Payment of Gratuity Act protects terminal benefits from attachment in any court proceedings. The Court held the bank must pay the gratuity of Rs. 3,57,770 plus 10% interest from date of death despite the civil court orders, as statutory protection cannot be overridden by attachment orders. The writ petition was dismissed and the bank was directed to pay within eight weeks.
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