Allowed

maiku lal v. State of U.P. and 3 others

Allahabad HC22 Jul 2021WRIC/3590/2018

Case brief

AI extract

What is this about?

Petitioner, a retired Chaukidar, sought interest on delayed gratuity of Rs.1,08,111. Court allowed simple interest at 6% p.a. from application date as Respondent delayed payment for over 11 years despite notice and contempt proceedings.

What did the court decide?

Simple interest at 6% p.a. from 07.09.2006 to 18.11.2017 on Rs.1,08,111; further penal interest of 2% if not paid within three months.

maiku lal Vs State of U.P. and 3 others — Pension and Retirement Benefits | Allahabad HC (2021)

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Court No. - 32

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Case :- WRIT - C No. - 3590 of 2018

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Petitioner :- Maiku Lal Respondent :- State Of U.P. And 3 Others Counsel for Petitioner :- Mr Brij Raj Counsel for Respondent :- C.S.C.,Mr Archit Mandhyan,Suresh Chandra Dwivedi

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Hon'ble Rohit Ranjan Agarwal,J.

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Heard Sri Brij Lal, learned counsel for the petitioner, learned Standing Counsel for respondents No.1 and Sri S.C.Dwivedi, learned counsel for respondents No.2 to 4.

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This writ petition has been filed seeking a direction for payment of simple interest in terms of Government Order dated 30^th October, 2002 and benefits provided under Section 7(3-A) of Payment of Gratuity Act, 1972 for the delayed of gratuity.

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The facts in nutshell are that the petitioner was posted as a Chaukidar on 01.7.1972 at Krishi Utpadan Mandi Samiti Ajuha Kaushambi (hereinafter referred to as “Mandi Samiti”). He attained the age of superannuation on 31.03.2005. The petitioner applied for payment of gratuity on 27.5.2005. The application of the petitioner was forwarded by respondent No.4 to the higher authorities for release of the said amount. Reminder letters were sent on 19.7.2005 and 16.8.2005. Despite the reminder letters when the amount was not paid, the petitioner filed Writ Petition No.57545 of 2014, which was disposed of vide order dated 22.01.2015 with a direction to the Competent Authority to consider his grievance within three weeks. As the order of the Writ Court was not complied with, a Contempt Application (Civil) No.5636 of 2015 was filed, which was disposed of on 10.9.2015 affording an opportunity to the respondents to comply with the order of the Writ Court. As the said order was not complied, second contempt application was filed which was registered as Contempt Application (Civil) No. 4972 of 2017. During pendency of the said contempt proceedings, respondents handed over a

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cheque of Rs.1,08,111/- on 18.11.2017 as amount of gratuity. A copy of the receipt has been brought on record as Annexure 11 to the writ petition. On 18.12.2017 an affidavit of compliance was filed by the Mandi Samiti and the contempt application was consigned to record. The petitioner before this Court has now sought interest for the delayed payment of 12 years and 9 months.

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Sri S.C.Dwivedi, learned counsel appearing for Mandi Samiti vehemently opposed the writ petition and submitted that an excess payment had been made to the petitioner to the tune of Rs.4,85,377/and after a long time the said payment was adjusted with the gratuity amount payable to the petitioner, which was sanctioned by the Finance Controller on 18.7.2013. Thus, the petitioner is not entitled for any interest on the payment of gratuity amount. He invited the attention of the Court to para 4 of the counter affidavit wherein it has been stated that on the application of the petitioner on 07.9.2006 to adjust the amount made in excess to the petitioner, the balance amount of the retiral dues be released in his favour, the matter was processed and on the same day i.e. 07.9.2006, respondent No.3 had apprised respondent No.4 of the said fact. Copy of the correspondence has been brought as Annexure CA-1 to the counter affidavit. Sri Dwivedi further contended that as the amount paid to the petitioner was in excess and it was only after the adjustment that the amount of gratuity has been paid to him and the petitioner while receiving the amount of gratuity had made an endorsement that no amount is left to be paid. He has also relied upon two decisions of Apex Court in the case of Chandi Prasad Uniyal and Others vs. State of Uttarakhand and Ors. MANU/SC/0656/2012 and order of Supreme Court dated 15.12.2020 passed in the matter of M/s Steel Authority of India Ltd. Vs. Raghbendra Singh & Ors. In Special Leave to Appeal (C) No.11025 of 2020 .

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I have heard learned counsel for the parties and perused the material on record.

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The sole controversy hinges around the payment of interest on delayed amount of gratuity released by the Mandi Samiti. It is not in dispute to the parties that petitioner was an employee of Mandi Samiti, who had attained the age of superannuation on 31.3.2005. According to the answering respondents, certain amount was paid in excess to the petitioner during fixation of his salary, which came into light subsequently in audit in the year 2002-03. As the petitioner had retired on 31.3.2005 and when he was apprised of the fact that certain excess payment of salary was made to him, he had made an application on 07.09.2006 to the Regional Deputy Director (Administration) Mandi Samiti for adjusting the amount paid in excess with the amount to be paid as retiral dues to the petitioner. It was on the very same day that the respondent No.3 had forwarded the application of the petitioner along with his covering letter to the respondent No.4 but the matter kept pending. According to the answering respondents, as stated in para 4 of the counter affidavit, the gratuity was sanctioned by the Finance Controller on 18.7.2013. Ultimately, when the second contempt application was filed before this Court that an amount of Rs.1,08,111/- was disbursed by the Mandi Samiti through cheque on 18.11.2017, meaning thereby that the said amount of gratuity was due to the employee and was not paid despite his request dated 07.9.2006 to adjust the excess amount and pay the balance amount of retiral dues.

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The argument of Sri Dwivedi to the extent that as the matter regarding excess payment was pending and it was only after the sanction by the Finance Controller, the payment could be made cannot be accepted as the Mandi Samiti was well aware of the fact after the Local Fund Audit made in the year 2002-03 that an excess

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amount of salary had been paid to the petitioner to the tune of Rs.4,85,377/-, which was to be adjusted from the petitioner’s legal dues, for which petitioner on 07.09.2006 had made an application and the same was forwarded by the officers of the Mandi Samiti, which has been accepted in para 4 of their counter affidavit and correspondence has been brought on record as Annexure CA-1. The answering respondent cannot escape liability for payment of interest for deliberately holding the matter and dragging the same unnecessarily for next 11 years and only when the contempt proceedings were initiated by this Court, on 18.11.2017 an amount of Rs.1,08,111/- was disbursed in favour of the petitioner.

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The argument of Sri Dwivedi to the extent that no amount was payable to the petitioner and in fact certain amount was to be recovered from the petitioner does not hold good as nowhere in the counter affidavit or before the contempt Court this fact has been brought or stated as to how much amount beyond Rs.4,85,377/- was recoverable from the petitioner. Once the Mandi Samiti itself on 18.11.2017 had handed over a cheque of Rs.1,08,111/- to the petitioner, it implies that after the entire deduction from the retiral dues, the balance amount was paid to the petitioner. Thus the argument made by counsel for the Mandi Samiti does not hold good and it is clear that the officers of Mandi Samiti had deliberately withheld the amount of retiral dues especially the gratuity of the petitioner unnecessary for a period of more than eleven years.

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Thus, I find that once the petitioner himself on 07.9.2006 had made an application for adjustment of the excess amount paid to him, which is accepted to the Mandi Samiti and the said application was forwarded to the higher authorities, the petitioner was entitled for all his retiral dues after the said cut off date after adjusting. He is thus

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entitled for interest on the delayed payment for the period 07.09.2006 to 18.11.2017.

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Moreover, the case law relied upon by the counsel for the Mandi Samiti in case of Chandi Prasad Uniyal and Ors.(supra) is not applicable in the present case and it is distinguishable in the present facts of case as here the petitioner himself had moved an application for adjustment of the amount from the excess payment made to him, which the authorities after adjusting had paid him balance amount on 18.11.2017.

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Similarly, the judgment in the case of M/s Steel Authority of India Ltd. (supra) is also not applicable because in that case the employee had not vacated the residential premises allotted to him. Moreover, the Apex Court in case of Balbir Kaur and another vs. Steel Authority of India Ltd. And another (2006) 6 SCC 493 has held that payment of gratuity is no longer in the realm of charity but a statutory right provided in favour of the employee.

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In State of Jharkhand and others vs. Jitendra Kumar Srivastava and another 2013 (139) AIC 44 SC the Apex Court held:

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“..gratuity and pension are not the bounties. An employee earns these benefits by dint of his long, continuous, faithful and unblemished service.

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It is thus hard earned benefit which accrues to an employee and is in the nature of “property”. This right to property cannot be taken away without the due process of law as per the provisions of Article 300-A of the Constitution of India.”

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In view of the above, as the respondent Mandi Samiti has failed to release the gratuity amount within reasonable time after retirement and it was only after a long drawn battle fought by the petitioner that balance amount of gratuity was released after more than 12 years.

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Thus, the petitioner is entitled for simple interest at the rate of 6% p.a. from 07.09.2006 till 18.11.2017 i.e. the date on which he made application for adjustment of the excess amount from his retiral dues till the payment made on 18.11.2017, of Rs.1,08,111/-, by the respondents.

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It is made clear that the interest amount shall be calculated and paid within next three months from the date of production of a copy of this order downloaded from the website of this Court. In case the said amount of interest is not paid to the petitioner, he shall be entitled for further penal interest of 2% p.a. above the rate of 6% p.a. granted by this Court.

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The writ petition stands allowed.

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Order Date :- 22.7.2021 Kushal

maiku lal v. State of U.P. and 3 others

Case brief

What is this about?

What did the court decide?

maiku lal v. State of U.P. and 3 others

Case brief

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