Kotagala Plantations Ltd. v. Kularatna and Others – sllr 2002 volume 2 page 392

In the case between Kotagala Plantations Ltd (petitioner) and Kularatna and Others, the court addressed the issue of whether a public company, formed by the conversion of a previously state-owned plantation corporation, is statutorily liable to pay gratuity to an employee whose service termination predated the formation of the company. It was held that the petitioner company was liable to pay the claimed gratuity, reaffirming the legal principle that statutory “deemed liability” under the Conversion of Public Corporations and Government Owned Business Undertakings into Public Companies Act, No. 23 of 1987 includes obligations which arose prior to incorporation. This interpretation relied on the operative sections of the 1987 Act and provisions of the Payment of Gratuity Act, No. 12 of 1983