MINISTRY OF LAW AND JUSTICE
(Legislative Department)

New Delhi, the 29th March, 2018

The following Act of Parliament received the assent of the President on the 28th March, 2018, and is hereby published for general information:—

THE PAYMENT OF GRATUITY (AMENDMENT) ACT, 2018

NO. 12 OF 2018

[28th March, 2018.]

An Act further to amend the Payment of Gratuity Act, 1972.

BE it enacted by Parliament in the Sixty-ninth Year of the Republic of India as follows:—

1. Short title and commencement.

(1) This Act may be called the Payment of Gratuity (Amendment) Act, 2018.

(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

2. Amendment of section 2.

In the Payment of Gratuity Act, 1972 (hereinafter referred to as the principal Act), in section 2, for clause (k), the following clause shall be substituted, namely:—

(k) “notification” means a notification published in the Official Gazette and the expression “notified” shall be construed accordingly;’.

3. Amendment of section 2A.

In section 2A of the principal Act, in sub-section (2), in the Explanation, in clause (iv), for the words “twelve weeks”, the words “such period as may be notified by the Central Government from time to time” shall be substituted.

4. Amendment of section 4.

In section 4 of the principal Act, in sub-section (3), for the words “ten lakh rupees”, the words “such amount as may be notified by the Central Government from time to time” shall be substituted.

G. NARAYANA RAJU,

Secretary to the Govt. of India.

List of Recent Gratuity Related Notification

Title Notification No. Date
Payment of Gratuity (Amendment) Act, 2018 applicable from 29.03.2018 Notification No. S.O. 1419(E). 29/03/2018
Govt. increases maximum gratuity limit to Rs. 20 Lakhs Notification No. S.O. 1420 (E). 29/03/2018
Govt notifies maximum maternity leave of 26 weeks for Gratuity Notification No. S.O. 1421 (E) 29/03/2018
President assents Payment of Gratuity (Amendment) Act, 2018 NO. 12 OF 2018 29/03/2018

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20 responses to “President assents Payment of Gratuity (Amendment) Act, 2018”

  1. Ramanand Jha says:

    My Father was expired in Nov 2017 & he was suppose to retire from ONGC on 28.2.2018. My Mother received gratuity of Rs 10 lakh tax free + 10 lakh with 33% tax deduction. The gazette notification s.o. 1419(E) & 1420(E) passed on 29.03.2018. please do inform whether I can this tax refund.
    With due regards.

  2. ajit parwani says:

    I retired from ONGC on 31.12.2017. I received gratuity of Rs 10 lakh tax free + 10 lakh with 33% tax deduction. The gazette notification s.o. 1419(E) & 1420(E) passed on 29.03.2018. please do inform whether I can this tax refund.
    With due regards.
    Ajit Parwani

  3. Jcporwal says:

    Please advise i
    Retired in December 17. is tax benefits is applicable to me or not as govt notification comes​ inforce on 29.3.18

  4. Hari says:

    Finally is there clarity now on applicable date for Gratuity Amendment act 2018 for private employees? is it 1/1/2016 or 29/03/2018

  5. C. L. Saini says:

    Sir,
    1. My company had classified the wages & salaries of all muster roll employees as 70% basic + 20% HRA & 10% Conveyance allowance for the purpose of EPF & ESI schemes. The gratuity is payable on basic salaries and wages. In my own particular case, no classification had carried out because I am not covered under any scheme of EPF & ESI right from the begning of my services. My salary is Rs. 38500.00 p. m. and it shown under the head of Basic Salary only. Here my question is this that : Am I eligible for the payment of gratuity at the rate of Rs. 38500.00 and not at the 70% of total salary amount?

    2. During my service tenure, I am met with a major accident on the road and spent lacs of rupees from my own pocket because I was not covered under ESIC. For the time being, my employer, at a specific request, advanced me some money equal to amount of gratuity accrued (but not due) up to that time to meet the accidental expenditures. At the end of the financial year, amount paid as advance against gratuity accrued ,transferred to Gratuity Paid Account from my Advance Account in the Books of Accounts of the Company. At the time of accident, I did not left the job of the company except 3.5 month without pay leaves spent in hospital and bed rest. Now my employer says that he had paid gratuity once to me (as advance) and no further payment of gratuity is due on later services. I joined on 06.08.2001. Accident date is 04.06.2012. Without pay leaves were from 04.06.12 to 17.09.12. Also there is a service break of 10 month approx. ( 01.05.14 to 22.02.15). During this service break, I undergone two operation : One for heart stent and second for removal of an accidental Implant. I am still on job. Kindly guide me that I am eligible for the payment of gratuity on my entire service tenure? My employer can recover the amount of advance paid to me against gratuity accrued and written off against Gratuity Paid a/c as agreed at that time.

  6. arif says:

    graduity amendmend should be effect from 1/1/16 , as proposed.

  7. A K DE says:

    We are working in port sector under Ministry of Shipping,Govt of India.All our pay revisiin dues are due from 1.1.2017.Central Govt employees have bn given revised gratuity from 1.1.2016 .Then what is the rationale in applying revised gratuity amount from 29.3.2018..Who should be responsible for not making it applicabke retrospectively and thus depriving several of their retirement dues.

  8. mk says:

    The irony is that it is effective from 29.3.2018 and not 1.1.2016 as the gazette notification does not speak on 1.1.2016

    They speak something and do the other thing

  9. GGovardhan Billa says:

    The Genesis for enhancing gratuity ceiling is 7 pay commission which is effective from 1.1.2016. Are the Central Government employees are paid enhanced gratuity from 29.03.2018 or 01.01.2016. Please clarify. Whether the present G.O issued for govt. employees or private employees ? Since already govt. depts are implementing it from 2016 onwards. is it justified that 29.03.2018 is effective date ?

  10. kk das says:

    When 20 lacs gratuity is already being paid from 1.1.16 then the effective date is self explanatory. Only 10 to 20 lacs was needed to be declared.

  11. CHANDRA KANT KALOUNI says:

    IT SHOULD BE EFFECTIVE FORM 1-1-2016 AS PROPOSED .

  12. MDS SASTRY says:

    What is applicable date of increased gratuity as per amended Act to central public sector employees ?

  13. Gulshan says:

    The govt decision to implement it from 29.3.18 instead of 1.1.18 is highly unjustified and in costitutional as some are allowed tax free rs 20.lacs since 1.1.16 some since 29.3.18. Are they not Indians who retired between 1.1.16 to 28.3.18. Is it democracy or clear cut demoncracy.

  14. VINAYAKA says:

    PLEASE CLARIFY WHICH IS THE EFFECTIVE DATE FOR GOVT EMPLOYEES ?

  15. Srinivas says:

    Why does the government always give a step motherly treatment to private employees? If I understand, the govt employees are eligible for 20 lakh limit from 1st Jan 2016. Then why should private employees not get the same. First of all, it would have avoided all these unnecessary complications if it had not restricted the benefit to govt employees while making the amendment way back in 2016 itself. Is this not changeable in court? Was it intended or someone goofed up while writing the notification in 2016, to specify it for govt employees only?

  16. Budibasappa says:

    As per govt note and approved by parliament effective date of gratuity payable is from 1/1/2016 were as Gazzetta notification effect date is 29/3/2018 please clarify which one is correct

  17. Kumar says:

    For public sector employees it was done retrospectively, but for private sector employees it seems to be effective only prospectively. Why this step motherly treatment?

  18. Rachana says:

    Dear Sir,

    please also let us know the gratuity for private employees where employees are less then 10 in a private organisation, but are serving the cpmpany for the past 20+ years

    Thanks,

  19. R satyanarayana says:

    While proposing the bill, the ceiling of 20 lakh. Is applicable from 1.1.16. Where as in the amended act it is applicable from 29.3.18. Hence it further requires clarification from govt.

  20. Madan Mohan Varshney says:

    What is implementation date for gratuity amendment bill 2018 for private employee?

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