Disposed¶36

United India Insurance Company Limited v. Sajal Kumar Banerjee and Others

Calcutta HC13 Jun 2024MAT/2123/2023

Case brief

AI extract

What is this about?

Interest on delayed payment of monthly salary; compensation for delay by way of interest; 6% per annum rate upheld; departmental proceeding; dismissal from service; superannuation; retiral benefits; contempt petition; United India Insurance Company Limited v. Sajal Kumar Banerjee & ors.; M.A.T.2123 of 2023; IA NO: CAN/2/2024; WPA 12032 of 2021; High Court at Calcutta; Debangsu Basak, J.; Md. Shabbar Rashidi, J.; judgment dated 13.06.2024; reliance on State of Andhra Pradesh & Anr. v. Dinavahi Lakshmi Kameswari, 2021(11) Supreme Court Cases 543 ((2021) 11 SCC 543).

What did the court decide?

No relief to the appellant; the impugned direction to pay interest at 6% per annum on the delayed monthly salary stands. MAT 2123 of 2023 along with IA NO: CAN/2/2024 disposed of without any order as to costs. ¶36

United India Insurance Company Limited Vs Sajal Kumar Banerjee and Others — Calcutta HC (2024) — LawSathi Research

What the court decided

AI extract

Outcome

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Issue for consideration

Whether the private respondent is entitled to compensation, by way of interest, for the delay in payment of his monthly salary. +1 more

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Court's answer

Salary was admittedly not paid on the due dates and there was delay; consequently, the private respondent's right to receive compensation for the delay in receipt of salary, by way of interest, cannot be denied.

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Ratio / Principle

The rate of interest of 6% per annum awarded by the learned Single Judge cannot be said to be arbitrary, harsh or burdensome upon the appellant.

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Key takeaways

The appeal has no merit.ratio¶35

Detailed headnote1 paragraphs

High Court at Calcutta (Debangsu Basak and Md. Shabbar Rashidi, JJ.), M.A.T.2123 of 2023, United India Insurance Company Limited v. Sajal Kumar Banerjee & ors., judgment dated 13.06.2024: appeal by the insurer against the learned Single Judge's order dated September 1, 2023 in WPA 12032 of 2021, which directed payment of interest at 6% per annum on the employee's monthly salary from the date it became due till actual payment, failed. Background: dismissal penalty of October 3, 2008 (appeal rejected May 21, 2009; review dismissed July 29, 2010); writ petition allowed September 25, 2013 setting aside the disciplinary order with direction to re-visit; employer's appeal dismissed March 20, 2018 and Special Leave Petition dismissed September 28, 2018; employee superannuated April 23, 2014; fresh penalty March 15, 2019; writ disposal of August 30, 2019 directed payment of all dues; retiral benefits were paid but interest on delayed salary was not. Held: salary admittedly remained unpaid on due dates, so the employee's right to compensation for the delay, by way of interest, cannot be denied; the 6% rate adopted by the learned Single Judge (who relied on State of Andhra Pradesh & Anr. v. Dinavahi Lakshmi Kameswari, 2021(11) Supreme Court Cases 543) is neither arbitrary, harsh nor burdensome; no merit in the appeal; MAT 2123 of 2023 with IA NO: CAN/2/2024 disposed of without order as to costs.

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Form No. J(2) Item No.4 Court No.26

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IN THE HIGH COURT AT CALCUTTA CIVIL APPELLATE JURISDICTION APPELLATE SIDE

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Present:

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The Hon’ble Justice Debangsu Basak And

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The Hon’ble Justice Md. Shabbar Rashidi

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M.A.T.2123 of 2023 IA NO: CAN/2/2024

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United India Insurance Company Limited VS.

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Sajal Kumar Banerjee & ors.

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For the Appellant : Mr. Shiv Shankar Banerjee Advocate For the Respondent No.1 : Mr. Subir Sanyal, Advocate Mr. Sutirtha Das, Advocate Mr. Sagnik Roy Chowdhury Advocate Mr. Sourojit Mukherjee, Advocate Hearing on : 13.06.2024 Judgment on : 13.06.2024

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DEBANGSU BASAK, J.:-

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By consent of the parties, appeal is taken up for final hearing on

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the basis of the papers made available to Court.

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Signed By : CHINMOY CHAKRABORTY High Court of Calcutta 14 th of June 2024 03:00:38 PM

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Appellant is aggrieved by the impugned order directing the appellant to pay interest at the rate of 6% per annum from the date of the monthly salary becoming due till the date of actual payment.

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Learned advocate appearing for the appellant submits that, the private respondent/respondent no.1 suffered a departmental proceeding. In such departmental proceeding, an order of the dismissal from service was passed as against the private respondent/respondent no.1. Private respondent/respondent no.1 filed a writ petition which was allowed. The departmental proceeding was directed to be reconsidered on certain issues. An appeal was carried. During the pendency of the appeal which was at the behest of the appellant, private respondent/respondent no.1 superannuated from service. The appeal was subsequently dismissed and a Special Leave Petition was carried which was also dismissed.

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Learned advocate appearing for the appellant submits that, thereafter, a fresh order for dismissal from service was passed as against the private respondent/respondent no.1 which was assailed in a writ petition. Such writ petition was allowed.

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Learned advocate appearing for the appellant submits that, thereafter, the appellant paid the retiral benefits to the private respondent/respondent no.1 along with requisite interest. Arrears of salaries were also paid. He, therefore, submits that, burdening the

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appellant with a direction for payment of interest for the period of nonpayment of salary is harsh and burdensome and should be set aside.

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The private respondent/respondent no.1 is represented.

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We find from the records that, the private respondent/respondent no.1 was proceeded against departmentally. An order of penalty of dismissal from service was initially imposed in such departmental proceeding as against the private respondent on October 3, 2008. Private respondent/respondent no.1 preferred an appeal which the Appellate Authority rejected by an order dated May 21, 2009. Review application of the private respondent/respondent no.1 was dismissed on July 29, 2010. 8. During the entirety of the period of the departmental proceeding, the private respondent/respondent no.1 was not suspended. 9. Subsequently, the private respondent/respondent no.1 filed a writ petition in 2011 which was allowed on September 25, 2013. The order of the Disciplinary Authority as affirmed in appeal and on review was set aside. Disciplinary Authority was directed to re-visit the issues afresh. 10. Being aggrieved by the order dated September 25, 2013 in the writ petition the appellant preferred an appeal. Such appeal was dismissed on March 20, 2018. During the pendency of the appeal, the private respondent/respondent no.1 superannuated from service on April 23, 2014.

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Appellant before us preferred a Special Leave Petition against the order of dismissal dated March 20, 2018 of the Division Bench. Such

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Special Leave Petition was dismissed on September 28, 2018. Private respondent/respondent no.1 thereafter filed a contempt petition for implementing the order of the learned Single Judge.

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The Appellate Authority, passed an order imposing penalty on March 15, 2019 against the private respondent/respondent no.1. Aggrieved by such order, a writ petition was filed which was disposed of by an order dated August 30, 2019 directing the authorities to pay all the dues of the private respondent/respondent no.1.

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Thereafter, appellant paid the retiral benefits of the private respondent/respondent no.1. However, the private

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respondent/respondent no.1 was not favoured with the interest on the delay in payment of salary. Consequently, the private respondent/respondent no.1 filed a writ petition being WPA 12032 of 2021 which was disposed of by the order dated September 1, 2023 which is impugned in the present appeal.

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Learned Single Judge took into the consideration the fact that, there was a delay in payment of the retiral benefits to the private respondent/respondent no.1. Learned Judge correctly held that, the private respondent/respondent no.1 was entitled to claim and receive interest on the amounts under different heads as and when they fell due till the date of actual payment. Learned Judge found that salary for each month was payable at the beginning of the next month. The same was not paid. Therefore, the learned Judge proceeded to award interest at the

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rate of 6% per annum for delay in payment of the salary. Learned Single Judge relied upon a decision of the Supreme Court reported at 2021(11)

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Supreme Court Cases 543 (State of Andhra Pradesh & Anr. Vs Dinavahi Lakshmi Kameswari) for the award of quantum of interest at the rate of 6% per annum on the component of the delay in payment of salary.

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Admittedly, salary was not paid on the due dates. There was delay in payment of the salary to the private respondent/respondent no.1. Consequently, right of the private respondent/respondent no.1 to receive compensation for the delay in receipt of the salary, by way of interest cannot be denied.

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As noted above, the rate of interest awarded by the learned Single Judge cannot be said to be arbitrary, harsh or burdensome upon the appellant.

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In such circumstances, we find no merit in the present appeal.

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MAT 2123 of 2023 along with IA NO: CAN/2/2024 are disposed of accordingly, without any order as to costs.

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Urgent photostat certified copy of this order, if applied for, be given

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to the parties on priority basis on compliance of all formalities.

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(Debangsu Basak, J.)

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(Md. Shabbar Rashidi, J.)

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I agree.

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CHC

Procedural history

How this case reached the court

AI extract

Order under challenge
Order dated September 1, 2023 of the learned Single Judge disposing of WPA 12032 of 2021, directing the appellant to pay interest at 6% per annum on the monthly salary from the date it fell due till actual payment.¶28
Learned Single Judge, High Court at Calcutta · September 1, 2023
Prior proceeding
Departmental proceeding against the private respondent ended with an initial order of penalty of dismissal from service imposed on October 3, 2008.¶22
Prior proceeding
Private respondent's appeal was rejected by the Appellate Authority on May 21, 2009.¶22
Prior proceeding
Private respondent's review application was dismissed on July 29, 2010.¶22
Prior proceeding
Throughout the departmental proceeding the private respondent was not suspended.¶22
Prior proceeding
Writ petition filed by the private respondent in 2011 was allowed on September 25, 2013; the Disciplinary Authority's order, as affirmed in appeal and review, was set aside and the Disciplinary Authority was directed to re-visit the issues afresh.¶22
Prior proceeding
Appeal carried by the appellant against the 2013 writ order was dismissed on March 20, 2018; during its pendency the private respondent superannuated on April 23, 2014.¶22
Prior proceeding
Special Leave Petition preferred by the appellant against the March 20, 2018 Division Bench order was dismissed on September 28, 2018.¶25
Prior proceeding
Private respondent thereafter filed a contempt petition seeking implementation of the learned Single Judge's order.¶25
Prior proceeding
Fresh disciplinary process concluded with the Appellate Authority passing an order imposing penalty on March 15, 2019.¶26
Prior proceeding
Writ petition against the March 15, 2019 order was disposed of on August 30, 2019, directing the authorities to pay all dues of the private respondent.¶26
Prior proceeding
Appellant thereafter paid the retiral benefits of the private respondent.¶27
Prior proceeding
Learned Single Judge awarded interest at 6% per annum on the delayed salary component, having relied on State of Andhra Pradesh & Anr. v. Dinavahi Lakshmi Kameswari, 2021(11) Supreme Court Cases 543.¶32

United India Insurance Company Limited v. Sajal Kumar Banerjee and Others

Case brief

What is this about?

What did the court decide?

United India Insurance Company Limited v. Sajal Kumar Banerjee and Others

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Cases cited

Procedural history

Parties & counsel

Coram

Case details

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