The High Court disposed of a writ petition by a class IV employee challenging interest liability. The court held that interest is payable for the withheld period and reduced the monthly deduction amount from Rs.10,000 to Rs.5,000.
Monthly recovery reduced to Rs.5,000; full amount remains liable for contract interest.
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Court No. - 58
Case :- WRIT - A No. - 11716 of 2018
Petitioner :- Lakhmi Chand Respondent :- State Of U.P. And 5 Others Counsel for Petitioner :- Rajesh Kumar Pandey Counsel for Respondent :- C.S.C.,Shiv Nath Singh
Hon'ble Ashwani Kumar Mishra,J.
Petitioner is a class IV employee, who is aggrieved by an order passed by the District Magistrate, Agra, as well as the consequential order passed by the Chief Medical Officer, Agra, whereby a sum of Rs.10,000/- per month is directed to be recovered from the salary of the petitioner in lieu of the loan availed by the petitioner from the society concerned.
The ground of challenge to the notice is that deduction was being made from the salary of petitioner at the rate of 5,000/per month, but without any reason the deduction was stopped for a period of almost two years by the respondents, and therefore, according to the petitioner, interest for such period is not liable to be paid by the petitioner. It is also stated that recovery of Rs.10,000/- per month would cause severe prejudice to the petitioner, who is a class IV employee.
Petition is opposed by Sri Shiv Nath Singh, learned counsel for the District Cooperative Bank and Sri A. K. Lal, learned counsel for the respondent no.5 and learned Standing Counsel for the State authorities.
It is pointed out that petitioner is currently receiving salary amounting to Rs.33,000/- approximately. Respondents, however, contend that initially deduction was being made routinely from the salary of petitioner, but there had been a change in the accounting system in the office with introduction of computers. Required details had to be feeded and deduction was to be made by following RTGS system. It is on account of such change in the accounting practice as well as use of computer in the office that the deduction could not be made for a period of nearly two years. It is contended that respondents are prepared to deduct the amount at the original rate, but there can be no waiver of interest from the petitioner.
Learned counsel for the petitioner submits that since the period of two years have lapsed for no fault of petitioner, as such he is not liable to pay interest.
I have heard learned counsel for the parties and perused the materials brought on record.
Admittedly, availing of loan by the petitioner as well as its recovery from the petitioner in terms of the contract are not in issue. The deduction initially was being made at the rate of Rs.5,000/- per month. It is on account of change in the accounting practice as well as use of computer that the deduction for certain period could not be made. The petitioner also does not appear to have intimated such facts to the respondents, nor has directly deposited such amount with the society. Petitioner clearly was aware that such amount is liable to be paid by him to the society. Petitioner could have easily deposited the amount directly to the society and having retained the amount with himself he cannot claim that he is not liable to pay interest. Interest is otherwise necessary corollary of withheld amount, and therefore, petitioner cannot resist his liability to pay interest (see: 2003 (3) Company Law Journal 238).
In the facts and circumstances, as petitioner is a class IV, it would be appropriate to provide that respondents shall continue to deduct a sum of Rs.5,000/- towards loan amount, which is still due and payable by the petitioner to the society. The society, however, shall be entitled to charge interest from the petitioner for the entire amount, as per the terms of contract.
Writ petition is, accordingly, disposed of.
Order Date :- 17.7.2018 Ashok Kr.
1 issue framed by the court
Whether interest is liable to be paid by the petitioner for the period during which deduction was stopped due to administrative failure despite petitioner's knowledge of the liability.
Colour shows how this judgement treated each authority
2003 (3) Company Law Journal 238Explained¶11
1 provisions across 1 enactments
Lakhmi Chand
State Of U.P.
Ashwani Kumar Mishra
As recorded by the court registry
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