Section 7B of Payment of Gratuity Act 1972 - Powers of Inspectors
Section 7B of the former Payment of Gratuity Act, 1972 specified the statutory powers available to an Inspector for checking compliance with the Act and with conditions attached to an exemption.
Meaning and purpose of former Section 7B
Section 7B enabled an Inspector, subject to rules made by the appropriate Government, to verify whether the Payment of Gratuity Act and the conditions of any exemption granted under it were being complied with. The provision authorised information gathering, inspection of premises and records, examination of relevant persons, copying of documents and, where an offence was reasonably suspected, search and seizure of relevant records.
Text of Section 7B - Powers of Inspectors
7B. Powers of Inspectors.
(1) Subject to any rules made by the appropriate Government in this behalf, an Inspector may, for the purpose of ascertaining whether any of the provisions of this Act or the conditions, if any, of any exemption granted thereunder, have been complied with, exercise all or any of the following powers, namely:-
(a) require an employer to furnish such information as he may consider necessary;
(b) enter and inspect, at all reasonable hours, with such assistants (if any), being persons in the service of the Government or local or any public authority, as he thinks fit, any premises of or place in any factory, mine, oilfield, plantation, port, railway company, shop or other establishment to which this Act applies, for the purpose of examining any register, record or notice or other document required to be kept or exhibited under this Act or the rules made thereunder, or otherwise kept or exhibited in relation to the employment of any person or the payment of gratuity to the employees, and require the production thereof for inspection;
(c) examine with respect to any matter relevant to any of the purposes aforesaid, the employer or any person whom he finds in such premises or place and who, he has reasonable cause to believe, is an employee employed therein;
(d) make copies of, or take extracts from, any register, record, notice or other document, as he may consider relevant, and where he has reason to believe that any offence under this Act has been committed by an employer, search and seize with such assistance as he may think fit, such register, record, notice or other document as he may consider relevant in respect of that offence;
(e) exercise such other powers as may be prescribed.
(2) Any person required to produce any register, record, notice or other document or to give any information by an Inspector under sub-section (1) shall be deemed to be legally bound to do so within the meaning of sections 175 and 176 of the Indian Penal Code, 1860 (45 of 1860).
(3) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall so far as may be, apply to any search or seizure under this section as they apply to any search or seizure made under the authority of a warrant issued under section 94 of that Code.
Key powers under Section 7B
- Calling for information: an Inspector could require an employer to furnish information considered necessary for checking compliance.
- Entry and inspection: an Inspector could enter covered premises at reasonable hours and examine statutory or employment-related registers, records, notices and documents.
- Production of records: the employer or other person concerned could be required to produce relevant records for inspection.
- Examination of persons: the Inspector could examine an employer or a person reasonably believed to be an employee on matters relevant to the inspection.
- Copies and extracts: relevant documents could be copied or extracts could be taken.
- Search and seizure: where there was reason to believe an employer had committed an offence under the Act, relevant records or documents could be searched for and seized in accordance with the statutory framework.
- Additional prescribed powers: the provision permitted exercise of other powers prescribed under the rules.
Current law - Section 122 of Code on Social Security 2020
Section 122 - Inspector-cum-Facilitators: The Code authorises appointment of Inspector-cum-Facilitators for enforcement of the social-security framework. The Central Government makes appointments for purposes connected with Chapters III and IV and related provisions, while the appropriate Government makes appointments for other provisions of the Code.
The current system is broader than the former gratuity-specific inspection provision. Section 122 provides for an inspection scheme, including web-based inspection and electronic calling of information, and empowers Inspector-cum-Facilitators to advise employers and employees regarding compliance in addition to exercising statutory inspection powers.
Transition from Inspector to Inspector-cum-Facilitator
Former Sections 7A and 7B operated specifically under the Payment of Gratuity Act. Under the Code on Social Security, the inspection mechanism is consolidated within Chapter XI, titled "Authorities, Assessment, Compliance and Recovery". For a current gratuity compliance issue, Section 122 and the applicable rules, schemes and Government notifications should therefore be examined together.
Historical references to IPC and CrPC
Former Section 7B(2) expressly referred to Sections 175 and 176 of the Indian Penal Code, 1860, and Section 7B(3) referred to search and seizure under the Code of Criminal Procedure, 1973. Those references are part of the historical statutory text. The IPC and CrPC were replaced for the current criminal-law framework by the Bharatiya Nyaya Sanhita, 2023 and the Bharatiya Nagarik Suraksha Sanhita, 2023 with effect from 1 July 2024, subject to their respective repeal and saving provisions.
Official legal resources
Ministry of Labour and Employment - Code on Social Security 2020
Gazette Notification S.O. 5319(E), 21 November 2025 - commencement notification