AI Structured Summary
Not yet generated for this judgment
Judgment
The present writ petition has been filed by the petitioner, Shri Abdul Zinnah Mondal for issuance of a writ in the nature of mandamus or any
other writ or order for directing the respondents to release the sanctioned retirement benefits being gratuity and leave salary to the petitioner.
The petitioner was appointed as Assistant Inspector of Taxes in Taxation Branch of the Garo Hills Autonomous District Council (GHADC) on
14th August, 1978. He was confirmed in the year 1985 and was re-designated as Enforcement Sub Inspector.
On attaining the age of superannuation the petitioner retired from service on 31st December, 2011 as Enforcement Sub Inspector. However, the
retiral benefits were not paid by the respondents for almost four months after his retirement. He moved an application on 19.04.2012 before the
respondent No. 2 and thereafter the process of settling and fixing the amount of gratuity and leave salary of the petitioner was started.
The petitioner stated that the respondent No. 4 vide letter dated 17th October, 2012 sanctioned a sum of Rs. 9,38,700/- (Rupees Nine Lacs
Thirty Eight Thousand Seven Hundred only) being the gratuity and leave salary and the same was payable in three equal installments. However, the
amount of Rs. 4,89,345/- (Rupees Four Lacs Eighty Nine Thousand Three Hundred Forty Five only) was deducted.
Learned counsel for the petitioner submits that despite repeated request and representations, gratuity and leave salary was not released by the
respondents.
Learned counsel for petitioner contended that the respondents have released all the retiral benefits to the persons who were junior to him and
retired much later than the petitioner, however, after lapse of more than four years, retiral benefits of the petitioner are not being paid by the
respondents without any cogent and plausible reason.
It is contended on behalf of the petitioner that rights under Article- 14 and 21 of the Constitution of India are being violated by the respondents
and unless protected, it would lead to deprivation of the petitioner''s right to livelihood.
It is further contended on behalf the petitioner that the respondents have illegally withheld payment of gratuity and leave salary of the petitioner
without any reason.
During the course of arguments, Mr. S.A. Sheikh, learned counsel for the petitioner submits that he is not disputing deduction of Rs. 4, 89,345/-
(Rupees Four Lacs Eighty Nine Thousand Three Hundred Forty Five only). He also submits that the respondents has paid Rs. 3, 12,900/-
(Rupees Three Lacs Twelve Thousand Nine Hundred only) towards leave salary on 30th April, 2016 and Rs. 4, 49,355/- (Rupees Four Lacs
Forty Nine Thousand Three Hundred Fifty Five only) towards the gratuity on 30th May, 2016 and no amount is pending towards the leave salary
and gratuity. However, the petitioner is claiming interest on the delayed payment.
Per contra, the respondents have opposed the petition by filing counter affidavit. The respondents have stated that the petitioner
misappropriated the Garo Hills Autonomous District Council revenue of Rs. 4, 89,345/- (Rupees Four Lacs Eighty Nine Thousand Three
Hundred Forty Five only). Thus, the petitioner is entitled to leave salary of Rs. 3, 12,900/- (Rupees Three Lacs Twelve Thousand Nine Hundred
only) and Rs. 4,49,355/- (Rupees Four Lacs Forty Nine Thousand Three Hundred Fifty Five only) towards the gratuity after deducting the amount
of Rs. 4, 89,345/- (Rupees Four Lacs Eighty Nine Thousand Three Hundred Forty Five only) from the total amount of Rs. 9, 38,700/- (Rupees
Nine Lacs Thirty Eight Thousand Seven Hundred only).
The respondents have further stated that due to financial crunch retiral benefits could not be paid to the petitioner and after deducting the
misappropriated amount, the due amount was paid to the petitioner. Learned counsel for the respondents argued that the petitioner suppressed
regarding misappropriation of funds to the tune of Rs. 4,89,345/- (Rupees Four Lacs Eighty Nine Thousand Three Hundred Forty Five only) in the
name of Garo Hills Autonomous District Council. Learned counsel for the respondents further argued that the petition has not come to this Court
with clean hands.
Learned counsel for the respondents also contended that the petitioner is not entitled to any interest as the amount of GHADC was
misappropriated by the petitioner.
I have given my anxious thought to the submissions advanced by learned counsel for both the parties. I have also carefully perused the
materials on record.
The main contention of the learned counsel for the petitioner is that the matter is squarely covered by judgement of the Hon''ble in the case of
''D.D. TEWARI (DEAD) THROUGH LEGAL REPRESENTATIVES vs UTTAR HARYANA BIJLI VITRAN NIGAM LIMITED AND
OTHERS'' reported as (2014) 8 SCC 894 wherein the Hon''ble Supreme Court held that the pension and gratuity are not a bounty to be
distributed by the Government to its employees on their retirement but are valuable rights and property in its hand, and any culpable delay in
settlement and disbursement thereof is to be visited with penalty of payment of interest.
The case of the respondents in the instant case is that the petitioner misappropriated funds to the tune of Rs. 4, 89,345/- (Rupees Four Lacs
Eighty Nine Thousand Three Hundred Forty Five only) in the name of the Garo Hills Autonomous District Council. Interestingly, there is nothing on
record to show that the petitioner was ever issued show cause notice in this regard or any enquiry was initiated against him when he was in service
though it is now claimed in the Court proceedings that the amount was deducted from the retiral benefits of the petitioner. The lethargy shown by
the respondent authorities in not taking any action according to law to enforce their right to recover the alleged misappropriated amount from the
petitioner or fixing liability after giving prior show cause notice or any opportunity to him renders the claim for misappropriated amount not only a
seriously disputed or contested claim but the respondents cannot be allowed to recover the alleged amount according to their whims in a vindictive
manner by adopting different and discriminatory standards. However, since learned counsel for petitioner has submitted that he not disputing the
amount of Rs. 4,89,345/- (Rupees Four Lacs Eighty Nine Thousand Three Hundred Forty Five only) deducted by the respondents, therefore, it
not necessary to enter into any further on this aspect.
Learned counsel for the petitioner submits that the petitioner is claiming interest for the delayed payment of retiral benefits. The Hon''ble
Supreme Court in the judgement of D.D. TEWARI''s case (supra) in paragraphs 6, 7 and 8 held as under:
It is an undisputed fact that the appellant retired from service on attaining the age of superannuation on 31-10-2006 and the order
of the learned Single Judge after adverting to the relevant facts and the legal position has given a direction to the respondent employer
to pay the erroneously withheld pensionary benefits and the gratuity amount to the legal representatives of the deceased employee
without awarding interest for which the appellant is legally entitled, therefore, this Court has to exercise its appellate jurisdiction as
there is a miscarriage of justice in denying the interest to be paid or payable by the employer from the date of the entitlement of the
deceased employee till the date of payment as per the aforesaid legal principle laid down by this Court in the judgment referred to
supra. We have to award interest at the rate of 9% per annum both on the amount of pension due and the gratuity amount which are
to be paid by the respondent.
It is needless to mention that the respondents have erroneously withheld payment of gratuity amount for which the appellants herein
are entitled in law for pay of penal amount on the delayed payment of gratuity under the provisions of the Pay of Gratuity Act, 1972.
Having regard to the facts and circumstances of the case, we do not propose to do that in the case in hand.
For the reasons stated above, we award interest at the rate of 9% on the delayed payment of pension and gratuity amount from the
date of entitlement till the date of the actual payment. If this amount is not paid within six weeks from the date of receipt of a copy of
this order, the same shall carry interest at the rate of 18% per annum from the date the amount falls due to the deceased employee.
With the above directions, this appeal is allowed.
In the case of ''M/S CHAMPARAN SUGAR CO. LTD VERSUS JOINT LABOUR COMMISSIONER AND APPELLATE
AUTHORITY AND OTHERS'' reported as AIR 1987 PATNA 96 (Full Bench), the Hon''ble Supreme Court considered the question whether
The Payment Of Gratuity Act, 1972 envisages the grant of interest on delayed payments of gratuity to an employee and held that the right of
interest on delayed payment of gratuity is statutory and the same can be granted in the absence of an express claim therefore in the application of
the employee. It was further held that if the basic claim of gratuity accrues irrespective of any application or express claim on behalf of the
employee, it is somewhat elementary that the consequential claim of interest for delayed payment would equally accrue without any express claim
therefor.
Section 7 of the Payment of Gratuity Act, 1972 provide for determination of the amount of gratuity and the payment thereof, which is
reproduced hereunder:
Determination of the amount of gratuity:
(1) A person who is eligible for payment of gratuity under this Act or any person authorised, in writing to act on his behalf shall send a
written application to the employer, within such time and in such form, as may be prescribed, for payment of such gratuity.
(2) As soon as gratuity becomes payable, the employer shall, whether an application referred to in sub-section (1) has been made or
not, determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the
controlling authority specifying the amount of gratuity so determined.
(3) The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable to the person to
whom the gratuity is payable.
(3A) If the amount of gratuity payable under sub-section (3) is not paid by the employer within the period specified in sub-section
(3), the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at
such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long-term deposits, as that
Government may, by notification specify:
Provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has
obtained permission in writing from the controlling authority for the delayed payment on this ground.
(4)(a) If there is any dispute to the amount of gratuity payable to an employee under this Act or as to the admissibility of any claim of,
or in relation to, an employee for payment of gratuity, or as to the person entitled to received the gratuity, the employer shall deposit
with the controlling authority such amount as he admits to be payable by him as gratuity.
(b)......
(c) .......
(d) ......
(e).....
(5)......
(6)......
(7)......
(8).....
A perusal of sub-section (2) of Section-7 clearly reveals that it is the onerous responsibility of the employer to determine the amount of gratuity
payable to a retiring employee. Sub-section-(3) of Section-7 enjoins a further responsibility on the employer, to disburse the amount of gratuity
payable to an employee, within 30(thirty) days from the date it becomes payable. Since the petitioner had attained the age of superannuation on
31st December, 2011, it is apparent, that gratuity had become payable to him on 31st December, 2011. Accordingly, the same ought to have be
calculated in terms of sub-section (2) of Section-7 of the Gratuity Act, and should have been dispersed to the petitioner by 31st January, 2012 in
terms of sub-section-(3) of Section-7 of the Payment of Gratuity Act, 1972.
Sub-section-(3-A) of Section-7 of the Payment of Gratuity Act, 1972 is the most relevant provision for the determination of the controversy in
hand. A perusal of sub-section (3-A) of the Act leaves no room for any doubt, that in case gratuity is not released to an employee within 30(thirty)
days from the date the same becomes payable under sub-section (3) of Section-7, the employee in question would be entitled to ""..........simple
interest at such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long-term loans as the
Government may, by notification specify.......
There is, however, one exception to the payment of interest envisaged under sub-section (3) of Section-7 of the Payment of Gratuity Act,
1972. The said exception is provided for in the proviso under sub-section (3-A) of Section 7 of the Act. A perusal of the said proviso reveals, that
no interest would be payable ""........ if the delay in payment is due to the fault of the employee, and the employer has obtained permission in writing
from the controlling authority for the delayed payment on this ground......."" The exception contemplated in the proviso under sub-section (3-A) of
Section-7 of the Payment of Gratuity Act, incorporates two ingredients. Where the two ingredients contemplated in the proviso under sub-section
(3-A) of Section-7 of the said Act are fulfilled, the concerned employee can be denied interest despite delayed payment of gratuity.
In the case of ''D.S NAKARA VERSUS UNION OF INDIA'' reported as 1983 SCR (2) 165, it has been held by the Hon''ble Supreme
Court that pension is a right and the payment of it does not depend upon discretion of the Government but is governed by the rules and a
Government servant coming within those rules is entitled to claim pension. It was further held that the grant of pension does not depend upon
anyone''s discretion.
The retiral benefits are not bounty but a right earned by the employee and thus it is deferred wages payable to a Government servant in lieu of
considerable length of service rendered by an employee to the employer. The quantum of retiral benefits although is governed by statutory rules but
it is clear that Government servant has a legal right to receive his retiral benefits as soon as he retires.
Since the date of retirement is known to the respondents well in advance, there is no reason for them not to make arrangement for payment of
retiral benefits to the petitioner well in advance so that as soon as the employee retires, his retiral benefits are paid on the date of retirement or
within a reasonable time thereafter. Inaction and inordinate delay in payment of retiral benefits is nothing but culpable delay warranting liability of
interest on such dues. Assigning the reason like, the financial position of the concerned department or there is financial crunch cannot be accepted
and will not save the respondent authorities from the liability from payment of interest.
In the case of ''STATE OF KERALA AND OTHERS vs M.PADMANABHAN NAIR'' reported as (1985) 1 SCC 429, the Honble
Supreme Court held as follows:
2......... Since the date of retirement of every Government servant is very much known in advance we fail to appreciate why the
process of collecting the requisite information and issuance of these two documents should not be completed at least a week before
the date of retirement so that the payment of gratuity amount could be made to the Government servant on the date he retires or on
the following day and pension at the expiry of the following month. The necessity for prompt payment of the retirement dues to a
Government servant immediately after his retirement cannot be over-emphasised and it would not be unreasonable to direct that the
liability to pay penal interest on these dues at the current market rate should commence at the expiry of two months from the date of
retirement"".
The salient ingredients of the proviso under sub-section (3-A) of Section 7 of the Payment of Gratuity Act, 1972 is clearly not satisfied in the
present case and, therefore, the petitioner cannot be denied interest under the proviso to Section-7 (3-A) of the said Act.
In view of the settled position of law in D.D. TEWARI''s case (supra) and what has been discussed herein above, this Court is of the view that
the petitioner is entitled to payment of gratuity and leave salary with interest thereon. However, according to the petitioner, the amount of gratuity
and leave salary have been paid after filing of the present writ petition, and therefore, the petitioner is entitled to interest on the delayed payment on
retiral benefits.
In the light of the aforesaid discussion, the respondents are directed to pay to the petitioner the interest on the amount of leave salary @ 6%
per annum and interest @ 8% per annum on the amount of gratuity from the date same became payable till the date of payment. No order as to
costs.
The writ petition stands disposed of.