Dear Vasant,
Sorry, I didn't come across any judgment either by any High Court or the Supreme Court so far on this aspect. Therefore what the requirement is a perspicacious analysis of the term " wages" as defined u/s 2(s) of the Payment of Gratuity Act,1972 which is as hereunder:
" Sec.2(s) "wages" means all emoluments which are earned by an employee while
on duty or on leave in accordance with the terms and conditions of his
employment and which are paid or are payable to him in cash and includes
dearness allowance but does not include any bonus, commission, houserent
allowance, ovrime wages and any other allowance. "
For the sake of exact understanding, the above definition can be divided into 3 parts viz., (a) the defining part (b) the inclusive part and (c) the exclusive part.
By part (a) wages means all emoluments earned by the employee while on duty or on leave in accordance with the terms and conditions of employment and such emoluments be paid or payable in cash. The legal meaning of the term 'emoluments' is a return arising from office or employment usually in the form of compensation or perquisites. Since gratuity is a terminal benefit based on service already rendered, the necessity for intoducing inclusion of something and exclusion of some other things to the emoluments, therefore, becomes imperative. Hence, the statute introduces the inclusive and exclusive parts.
By part (b), wages include dearness allowance.
By part(c), wages exclude other payments in the form of cash viz., bonus, commission, house-rent allowance, overtime wages and other allowance. In salary and wage administration, as basic wages or salary is fixed and invariable, allowances are granted in addition for specific purposes in connection with the work of the employees as well as its duration.That is the reasoning for the inclusion of D.A to and the exclusion of the specfic other items from the emoluments paid or payable to an employed person.
As you are well aware, a consolidated wage or salay is fixed through out the tenure of employment. Therefore, it has to be taken as a whole for the purpose of computation of gratuity on the legal or normal termination of employment of such employees.
Hope you are convinced.