Samar Singh vs Union Of India And Ors

A.K. Bishnoi, Member (A)

The applicant, in the present OA, was working as Chief Vigilance Inspector in the respondent-organization. On the basis of certain charges, he was placed under suspension and disciplinary proceedings initiated against him. The suspension order was revoked on 27.09.2002. While the disciplinary proceedings continued, the applicant superannuated on 30.09.2003. As a consequence of the disciplinary proceedings, the applicant was imposed the penalty of withholding of 50% of pension with permanent effect vide order dated 11.02.2008.

Aggrieved by this order, the applicant approached this Tribunal through OA No. 1290/2008, which was disposed of on 20.11.2008 with the following directions:-

"Resultantly, for the foregoing reasons, leaving other grounds open, the OA is allowed to the extent the impugned order is set aside. Respondents are directed to restore to the applicant his withheld 50% pension along with arrears, within a period of three months from the date of receipt of a copy of this order. However, we are not inclined to grant any interest to the applicant. No costs."

2.1 The applicant thereafter, not satisfied with this order, raised his grievance in another OA No.1639/2011, seeking certain reliefs, which was disposed of on 28.01.2013, as follows:-

"2. In the circumstances, we are inclined to dispose of this Original Application as infructuous. However, we grant liberty to the applicant to make a representation to the respondents, if any grievance still subsists and if the applicant prefers such a representation, the respondents shall consider the same within two months thereafter and pass an appropriate order in accordance with rules".

2.2 The applicant thereafter made a number of representations, the details of which need not be gone into in view of the fact that compliance affidavit has been filed by the respondents dated 08.08.2016  in response to which the applicant has filed a rejoinder dated 18.01.2017 in which he has submitted that:

a) The respondents have paid full gratuity & leave encashment;

b) They have corrected the basic pay of the applicant;

c) They have paid all the retiral benefits to the applicant in the correct basic pay;

d) They have paid the remaining 50% suspension amount.

The applicant has, however, submitted that no interest on any of these payments has been paid and has demanded payment of simple interest @ 18% per annum.

Thus,  as  per  the  applicant's  own  averment,  the  only  issue which needs to be settled is that of payment of interest.

2.3 We have carefully considered the pleadings on record as also the arguments advanced by the learned counsels for the two sides.

2.4 On the issue of payment of interest, it has been held by the Hon'ble Apex Court in D.D. Tiwari (D) Thr. LRs vs. Uttar Haryana Bijli  Vitran  Nigam  Ltd.  &  Ors.  Civil  Appeal  No.  7113/2014 [Arising out of SLP (C) No. 25015/2011] decided on 01.08.2014 that:-

"3..........The High Court has adverted to the judgments of this Court particularly, in the case of State of Kerala & Ors. Vs. M. Padmanabhan Nair[1], wherein this Court reiterated its earlier view holding that the pension and gratuity are no longer any bounty to be distributed by the Government to its employees on their retirement, but, have become, under the decisions of this Court, valuable rights and property in their hands and any culpable delay in settlement and disbursement thereof must be dealt with the penalty of payment of interest at the current market rate till actual payment to the employees. The said legal principle laid down by this Court still holds good in so far as awarding the interest on the delayed payments to the appellant is concerned......."

4 & 5.  xxx  xxx  xxx

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 of amount falls due to the deceased employee. With the above directions, this appeal is allowed."

Further,  the  Hon'ble  High  Court  of  Delhi  in  W.P.  (C)  No. 1227/2012-Delhi Police vs. Balwant Singh decided on 13.03.2012,  has held as follows:-

"4. The first issue that we have to consider is whether any interest, at all, is payable on the delayed payment of the leave encashment amount. This question need not detain us any longer inasmuch as recently, in the case of Government of NCT of Delhi v. S.K. Srivastava: WP(C) No. 1186/2012 which was decided on 29.02.2012, we had decided that interest would be payable on delayed payment of the leave encashment amount where the delay is on account of no fault on the part of the employee. In that decision, we had observed as under:-

"The learned counsel for the petitioner states that all other dues had been paid to the respondent along with interest at the GPF rate, but since there was no provision in the leave rules for grant of interest, that is why the present petition has been filed. We do not agree with the submission made by the learned counsel for the petitioner that because there are no rules providing for grant of interest, the respondent would not be entitled to the same. There is also no bar to the grant of interest whenever the leave encashment amount is delayed for no fault on the part of the employee. The Government has retained the money from the year 2000 till 2011, which, in any event, was due to the respondent in the year 2000 itself, particularly in view of the fact that even the conditions specified in Rule 39(3) had not been complied with. Consequently, grant of interest on the said amount at the GPF rate by the Tribunal cannot be faulted. In any event, we may also point out that between 2000 and 2011, because of inflation, the real value of the amount that was due to the respondent had substantially eroded, the payment of interest at the GPF rate would only be a kind of balm applied to the injury suffered by the respondent. It may, in fact, actually turn out that the petitioner would not be paying anything more in real terms than what it was liable to pay in the year 2000."

Thus following the said decision, interest would be payable by the petitioner even on the leave encashment amount and, therefore, the Tribunal's decision in this regard cannot be faulted. In the case of S.K. Srivastava (supra), we had also directed that the rate of interest be granted at the GPF rate. The learned counsel for the respondent has placed before us a decision of the Supreme Court in the case of Vijay L. Mehrotra v. State of U.P. & Ors: JT 2000 (5) SC 171, where the Supreme Court had granted interest on, inter alia, the delayed payment of the leave encashment amount at the rate of 18% per annum. The relevant portion of the said Supreme Court decision is as under:-

"2. The appellant retired from service on 31st August, 1997. From the response, filed by the respondent, it is clear that most of the payments of the retiral benefits to her were made long after she retired on 31st August, 1997. The details of the payments so made are as under:

S.No.

Particulars

Amount Paid

Date

(i)

GPF 90%

Rs 1,80,899.00

27.11.1997

(ii)

GPF 10%

Rs 20,751.00

25.04.1998

(iii)

GIS

Rs 13,379.00

27.02.1998

(iv)

Enchashment of leave

Rs 41,358.00

27.09.1998

(v)

Arrears of pay

Rs 15,495.00

27.09.1998

(vi)

Gratuity

Rs 1,09,753.00

05.12.1998

(vii)

Commuted pension

Rs 20,484.00

05.12.1998

(viii)

Detained amount

Rs 45,000.00

05.11.1999

In case of an employee retiring after having rendered service, it is expected that all the payment of the retiral benefits should be paid on the date of retirement or soon thereafter if for some unforeseen circumstances the payments could not be made on the date of retirement.

In this case, there is absolutely no reason or justification for not making the payments for months together. We, therefore, direct the respondent to pay the appellant within 12 weeks from today simple interest at the rate of 18% per cent with effect from the date of her retirement i.e. 31st August, 1997 till the date of payment."

Since in the aforementioned case, the Supreme Court had directed that interest be paid at as high a rate as 18% per annum on both gratuity as well as the leave encashment amount, we see no reason to interfere with the directions of the Tribunal granting interest at the rate of 9% per annum."

In U. Rai Arya vs. Union of India & Another (OA No. 908/2014 dated 18.02.2015), this Tribunal had held as follows:-

"7...............When he was entitled to get his retirement benefits immediately after his superannuation on 30.06.1994, he actually got them only on 01.02.2008. The only way to compensate for the loss suffered by him is to pay him the interest. The respondents have paid him the interest on DCRG, as there is a specific rule by the respondents to pay interest if there was delay in payment of DCRG. However, there is no rules framed by the respondents to pay interest on the other retirement dues. Just because the Respondents have no rules for payment of interest on the other retirement benefits, the employee cannot be made to suffer. In such circumstances, as held by the Apex Court in the case of S.K. Dua (supra), the Articles 14, 19 and 21 of the Constitution of India would apply because the retirement benefits are not a bounty....................

In the above facts and circumstances of the case, I allow this O.A. and direct the respondents to give the applicant interest @ 9% on all dues which would have been otherwise admissible to him had he been allowed to retire on superannuation on 30.06.1994 itself. They shall also pay the difference of salary and allowances for the suspension period with 9% interest, if not paid already. The respondents shall calculate the interest payable on each of the items separately and furnish the calculation sheets to the Applicant for his verification.........."

(emphasis supplied)

The said judgment was challenged before the Hon'ble High Court of Delhi in W.P. (C) No.7131/2015-Union of India & Ors. vs. U. Rai Arya, which was dismissed on 29.07.2015 with the following observations:-

"9. The short question which gains importance in this case is as to whether the retirement dues of the respondent were withheld on account of any fault of the respondent....."

(emphasis supplied)

By the order of this Tribunal in OA No.1290/2008 dated 20.11.2008, the impugned order has been set aside. The obvious implication of this is that the applicant is entitled to payment of his retiral dues from the date of superannuation. As for the other dues the relevant dates would be when the applicant became entitled to be paid those dues.

This being so, there is no reason why the applicant should be put to financial disadvantage if delay in actual payments is caused by a course of events which were not caused by him but were attributable to the respondents. Consequently, it is just fair that the respondents should compensate the applicant for this delay through payment of interest for the period of delay.

On the part relating to pension, the order of this Tribunal dated 20.11.2008 in OA No.1290/2008 makes it clear that no interest would be paid on the arrears. The present matter before us is as a result of this order which has attained finality. Hence, as per the order in the OA no interest had to be paid on the arrears of pension. However, this covers the period till the date of the receipt of a copy of the order in the OA mentioned above with a further period of three months added to it as allowed in the order itself for the payment of arrears. Any further delay would be squarely covered by the judgements cited above and interest would need to be paid by the respondents.

Hence, the OA is allowed with a direction to the respondents to pay interest at the prevailing GPF rate of interest on all delayed payments made to the applicant. For arrears of pension interest is to be paid for the period starting from the date as explained above till the date when payment was actually made. For all other dues interest is to be paid for the period starting from the date of entitlements, till the date of payment of the dues. All payments are to be made within a period of sixty days from the receipt of a certified copy of this order. The respondents shall also supply to the applicant, within the specified time, a detailed calculation sheet, item-wise, explaining how the amounts have been worked out. No costs.