Allowed

Rama Shanker Shukla v. Union of India Thru. Its Secy. Deptt. of Telecommunications Ministry of Communications and 2 Others

Allahabad HC18 Apr 2024WRIA/2984/2024

Case brief

AI extract

What is this about?

The High Court of Judicature at Allahabad issued a writ order allowing the petitioner's claim for interest on delayed leave encashment payment. Although the respondent argued that leave encashment is not a statutory duty and thus interest is not due, the court relied on its own precedent and the principle that interest is a natural accretion of capital to award interest.

What did the court decide?

Directed respondents to pay interest at 7% per annum from the date of retirement for the period of delay until actual payment, within four months.

Rama Shanker Shukla vs Union of India… — Pension and Retirement Benefits | Allahabad HC (2024)

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Neutral Citation No. - 2024:AHC-LKO:30315

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Court No. - 20

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Case :- WRIT - A No. - 2984 of 2024

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Petitioner :- Rama Shanker Shukla Respondent :- Union Of India Thru. Its Secy. Deptt. Of Telecommunications Ministry Of Communications And 2 Others Counsel for Petitioner :- Raj Mani Dubey Counsel for Respondent :- A.S.G.I.,Satya Prakash Tiwari

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Hon'ble Shree Prakash Singh,J.

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Heard learned counsel for the petitioner, Sri Anand Dwivedi, learned counsel for the respondent no. 1 and Ms. Nidhi Singh, Advocate holding brief of Shri Satya Prakash Tiwari, learned counsel appearing for respondent nos. 2 & 3.

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Contention of learned counsel for the petitioner is that although the petitioner has been paid the leave encashment, the interest on delay has not been paid and thus, he is entitled to interest from the date of retirement i.e. 31.08.2017 till actual payment.

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Learned counsel for the respondent argues that a circular has been issued by respondent no.2 saying that no interest shall be paid on the delayed payment of gratuity as it is not a statutory payment.

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In the light of the said, learned counsel for the respondent argues that no interest is payable as demanded by the petitioner.

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Learned counsel for the petitioner places reliance on the judgment of this Court in the case of Nand Lal v. Indian Telephone Industries Limited and 2 Ors. (Writ - A No.31490 of 2016) decided on 09.03.2018 wherein a similar issue was considered and decided by this Court and the interest was held to be payable on account of delay.

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It is informed by learned counsel for the respondent that in a similar case, this Court in Writ Petition No.20927 (SS) of 2021 has called for a counter affidavit. It is further informed that SLP(C) No.004379 of 2019 against a similar order passed

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by this Court, is pending before the Hon'ble Supreme Court.

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Considering the fact that the decision has been taken only on the ground that the dues of leave encashment are not statutory dues, as such, no interest is payable, the same is liable to be rejected on the simple analogy that interest is a natural accreditation of capital. Even otherwise, the payment of leave encashment flows out of the decisions taken and thus, cannot be said that it has no flavour of statutory enactment.

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Thus, following the judgment in the case of Nand Lal (Supra), the writ petition is allowed.

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Respondents are directed to ensure payment of interest at the rate of 7% per annum on the leave encashment for the period from date of retirement till actual payment, if the rules permits so.

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The said interest shall be paid to the petitioner within a period of four months.

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Order Date :- 18.4.2024 AKS

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Digitally signed by :- ANUJ KRISHNA SRIVASTAVA High Court of Judicature at Allahabad, Lucknow Bench

Rama Shanker Shukla v. Union of India Thru. Its Secy. Deptt. of Telecommunications Ministry of Communications and 2 Others

Case brief

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Rama Shanker Shukla v. Union of India Thru. Its Secy. Deptt. of Telecommunications Ministry of Communications and 2 Others

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