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Chapter 10
State Railway Gratuity Rules

 1001. Extent of application.-Except as provided for in rule 1008, these rules shall apply to temporary railway servants recruited under the normal recruitment rules prior to 16th November, 1957 and who have not opted for the Pension Scheme;  

Note. - These rules also apply to temporary engineers recruited either locally, or through the Union Public Service Commission, after 19th October, 1955 but prior to 16th November, 1957 provided they have not opted for the Pension Scheme.  

 1002. Definitions.-In these rules unless there is anything repugnant in the subject or context,-

(1) 'Controlling Officer' means, in relation to the classes of railway servants specified in the first column of the table below, the officer or authority specified in the corresponding entry in the second column thereof;

Classes of railway servants

Controlling Officer

 1.      Railway servants under the administrative     control of a General Manager.

2.        Railway servants employed in the Railway Audit Department.

3.         Railway servants employed in a department or office directly under the control of the Railway Board.

4.        Railway servants employed in the office of the Railway Board.

 The General Manager.

The Additional Deputy Comptroller and Audit General of India (Railways).

The head of the department or office.


 The Secretary, Railway Board.

 (2) 'Children' means legitimate children and step-children and shall also include adopted children at the discretion of the Controlling Officer according to the circumstances of each case irrespective of whether the adoption was valid under the personal law of the subscriber, having regard to his religion, or not.  

(3) 'Pay' means the average pay as defined in the manner indicated in rule 103(35) except that in the case of grant of compassionate gratuity to :-  

(i)   a permanent railway servant it will mean the substantive pay admissible to him in  the permanent post on which he holds a lien or would hold a lien had it not been  suspended on the date of quitting service, and shall include personal pay and special pay;   

(ii) a temporary railway servant the pay last drawn by him in the temporary post  which he would have officiated continuously but for his death:  

Provided that in respect of a railway servant of either case, entitled to running allowances, pay shall also include the monthly average running allowances drawn by the railway servant during 365 days of running duty immediately preceding the date of quitting service limited to 75 percent of average pay for the same period.

Note 1.-Pay for this purpose shall also include "Dearness Pay". 

Note 2.- The provision contained in rule 902(8) equally apply in this case.  

Railway Board's decision.-Railway Board’s decisions under rule 902(8) shall also apply to this rule.  

(4) 'Railway Servant' means a person belonging to the Railway Audit Department or holding a post under the administrative control of the Railway Board, other than a person whose services are obtained on loan from a Department not under the control of the Railway Board or the Additional Deputy Comptroller and Auditor General of India (Railways).  

(5) 'Running allowance' is an allowance ordinarily granted to running staff for the performance of duty directly connected with the charge of moving trains, and includes mileage allowance but excludes special compensatory allowance.  

(6) 'Service' for the purposes or these rules means a continuous service paid monthly from railway revenues and includes any periods-  

(i)  of officiating or temporary service or service as paid apprentice or as probationer ;     

(ii)  spent on the works Establishment of the Railway whose pay is paid monthly; or

(iii)  which the President may by general or special order permit to be counted as service.  

 1003. A gratuity may be paid to a temporary railway servant.-  

(a) on discharge from service arising directly or indirectly from a reduction of establishment; or

(b) on retirement on account of permanent incapacity due to bodily or mental infirmity.  

Railway Board's orders.-1. These orders do not apply to those temporary engineers who were recruited upto 19th October, 1955 and are governed by the following provisions: -  

(i)   Temporary engineers should subscribe to the State Railway Provident Fund on completion of one year's continuous service, the amounts of subscription, the contribution by Government and other conditions for such subscription and contribution, etc. being the same as those laid down in the State Railway Provident Fund Rules. In case the employee quits service for any reason, whatsoever, before the completion of five years service, Government contribution and the interest thereon will not be payable but in such cases gratuity at half a month's Pay for each completed year of service will be payable if the employee retires :  

(a) on account of permanent incapacity due to bodily or mental infirmity; or  

(b) on abolition of appointment due to a reduction of establishment; and  

(ii)  a special contribution will be payable in add1tion to the Government's contribution payable under (i) above if the service of the employee exceeds a continuous period of 12 years; this will be subject to the usual condition governing the grant of special contribution to a Gazetted officer in permanent employ.  

(Railway Board's letter No. E47RC/1C1, dated the 24th February, 1950, 30th March, 1950 and E 54RC2/ 14 dated the 19th October 1955).  

2. Grant of gratuity at the rate of a half a month's pay for each completed year of service is normally admissible to temporary railway servants discharged from service; provided that they have been recruited under the normal recruitment rules and that their discharge has been due to the reduction of establishment and not due to cessation of isolated temporary posts. This concession does not cover staff recruited otherwise on construction projects where the cessation of currency of sanction to temporary posts on completion of different phases of work cannot strictly be held to be "reduction of establishment". It has, however, been decided that the benefits of granting gratuity in the cases of staff employed on projects or a group of works or constructions; should be viewed sympathetically so long as they are not cases of persons engaged for brief periods on projects or elsewhere, who are discharged on cessation of currency of isolated temporary posts. All cases of expected retrenchment of staff where it is proposed to grant gratuity, should be referred to the Railway Board for sanction.  

 (Railway Board's letter No. F(S) 56-CPC/44 dated 13-9-55).  

 1004. No gratuity shall be admissible to re-employed retired staff.  

 1005. Amount of gratuity. -The amount of gratuity for which a railway servant is eligible under these rules shall be as follows :-  

(a)  If service does not fall short of fifteen years, half a month's pay for each completed year of service, but not exceeding fifteen months' pay.  

(b)  If service falls short of fifteen years, half month's pay for each completed year of service, but not exceeding six months' pay.  

 1006. If a railway servant dies in service, his widow or widows and/or dependent children shall be granted gratuity under Rule 1003(b) as if he had on that day been permanently incapacitated as follows :-  

(a)    After completion of one year's service but before completion of three years' service. 

(b) After completion of three years' service but before completion of five years' service.  

(c) After completion of five years' service.

One month's pay.

Three months' Pay.

 Half a month's pay for each completed year of service subject to a minimum of twelve months' pay.

 If he dies after discharge or retirement before receiving gratuity under Rule 1003, the amount admissible will be payable to his widow or widows and/or dependent children. If a female railway servant dies before receiving gratuity, the amount admissible may be paid to the dependent children whether their father is earning or not.  

 1007. The amount of gratuity and the proportion in which the gratuity shall be distributed among the widow or widows and or dependent children shall be fixed by the controlling officer :

Provided that where the controlling officer is lower in rank than the authority competent to dismiss the railway servant concerned, the gratuity shall not be withheld nor shall the amount be fixed at a figure less than the maximum permissible under these rules except with the previous sanction of that authority.  

 1008. Compassionate gratuity.*-(1) Irrespective of the restrictions laid down elsewhere in these rules when a non-gazetted railway servant, whether permanent or temporary, dies in service, or dies after quitting service but before receiving payment of his service, gratuity or special contribution admissible under rule 915, the controlling officer may grant a compassionates gratuity to :-

(i)  his widow, children, parents, brothers or sisters; or  

(ii) with the previous sanction of the Railway Board, to any other relatives of the de- ceased, who were dependent on him and have been left in straitened circumstances by reason of his death.  

Provided that no such gratuity shall be given in addition to a gratuity under rule 1006 or any special contribution admissible under rule 915.  

(2) The amount of compassionate gratuity shall not ordinarily exceed half a month's pay for every year of service, permanent and temporary, completed by the deceased railway servant, and shall ordinarily be subject to a maximum of fifteen months' pay:  

Provided that the amount calculated shall not be less than 12 months pay.  

Note.- The Railway Board's sanction is necessary to the grant of compassionate gratuity exceeding Rs. 5,000/- in any case. The Railway Board's powers will be exercised upto Rs. 7,500/- in any case.  

Railway Board's decision.-Conditions for the grant of a compassionate gratuity are that the person concerned was dependent on the deceased railway servant and that he was left in straitened circumstances. 'Dependence' and the 'Straitened circumstances' are questions of facts to be determined by the sanctioning authority with reference to the circumstances of the individual case and should be established by convincing evidence and it is unnecessary for this purpose that the dependence should have been complete.  

(Railway Board's letter No.9287 F dated the 6th March, 1941.)

*For rules relating to the grant of gratuity from the compassionate Fund of the Govt. of India to the families of pensionable Railway Servant left indigent circumstances, see Appendix III to this Volume .

               1009. If the person to whom any amount is to be paid under rules in this chapter is a minor or lunatic for whose estate a guardia11 under the Guardians and Wards Act, 1890 (VIII of 1890) or a manager under the Indian Lunacy Act, 1912 (IV of 1912), as the case may be, has been appointed, the payment shall be made to the person, authorised by law to receive payment on behalf of the minor or lunatic. In cases where no natural guardian of minor or minors exists and where each minor's share after deduction of Government dues etc. does not exceed Rs. 500, the payment may be made to the person considered fit by the controlling officer to receive payment on behalf of the minor or minors without requiring  him to produce  a guardianship certificate, provided he executes a bond signed by two sureties agreeing to indemnify the railway against any subsequent claims which might arise.  

 1010. The controlling officer may, at any time before a gratuity is paid, order the deduction therefrom of any dues payable by the railway Institute, Co-operative Credit Society or Stores, or Hospital. Any amount so deducted shall be adjusted against these dues.  

 1011. Contribution during deputation or foreign service. --When the services of a railway servant are lent to another Department/Ministry of Government or a State Government or to a foreign employer, a contribution towards Government contribution to provident fund and gratuity at the rate specified in paragraph 1255 of the Indian Railway General Code, Vol. I shall be levied during the period of loan, from the Department/Ministry of Government or the State Government or the foreign employer of the railway servant concerned as may be settled in each case.  

Note. In cases where, instead of contribution for leave salary, the incidence  of leave salary is regulated by rule 829 of the Indian Railway Financial Code, Vol. I, the gratuity contribution shall be levied at 1/24th of the total of the pay in foreign service plus contribution that would have been otherwise payable on account of leave salary.  

 1012. Delegation of powers.--The controlling Officer may delegate all or any of his powers under these rules, excepting the powers under provision below rule 1007 and rule 1008 either generally or in respect of a specified class of rail servants to one or more Group  ‘A' or  ‘B' officers subordinate to him.

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