Allowed¶36

Dr. Shamoli Kundu v. Municipal Corporation of Delhi

Service Law – Retiral benefits – Non-payment at superannuation

Delhi HC6 Mar 2025W.P.(C)/16960/2024

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Case brief

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What is this about?

Dr. Shamoli Kundu v Municipal Corporation of Delhi, W.P.(C) 16960/2024 & CM APPL. 71831/2024, High Court of Delhi (C. Hari Shankar & Ajay Digpaul, JJ.), order dated 06.03.2025 — interest on delayed retiral dues payable from date of retirement/superannuation, not from expiry of Tribunal's three-month window; CAT order modified; 7.5% p.a. from superannuation till payment, 12% p.a. beyond six months; MCD v Bijender Singh, 2024 SCC OnLine Del 7716, relied on.

What did the court decide?

Writ petition allowed; Tribunal's order modified so that interest @ 7.5% p.a. on retiral dues runs from the date of the petitioner's superannuation till payment of principal, with the existing direction for 12% p.a. beyond six months from the Tribunal's judgment retained. ¶36

Dr. Shamoli Kundu Vs Municipal Corporation of Delhi — Delhi HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

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Issue for consideration

From what date should interest on the petitioner's delayed retiral dues run — from the date of retirement/superannuation, as urged by the petitioner, or from the expiry of the three-month period fixed by the Tribunal? +1 more

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Court's answer

Interest is an accretion on principal and becomes due from the time the employee is deprived of the amount legitimately due; the MCD offered no explanation for not disbursing retiral dues at retirement.

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Ratio / Principle

Consistent with the Court's earlier decision in MCD v Bijender Singh (2024 SCC OnLine Del 7716), an employee is entitled to interest on retiral dues from the date of his retirement.

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Key takeaways

The Tribunal's order is modified: interest @ 7.5% p.a. is to be reckoned from the date of the petitioner's superannuation, and not from the expiry of three months from the order of the Tribunal, till the date the principal amount of the retiral dues was/is paid.ratio¶31
The Tribunal's direction increasing the rate of interest to 12% p.a. where the amount is not paid before expiry of six months from the date of the Tribunal's judgment stands unchanged.ratio¶35
On delay in disbursal of retiral dues the Court must adopt a strict stance, as such dues are at times the principal source of sustenance of a Government servant and family in the evening of their lives.

Detailed headnote1 paragraphs

Service Law — Retiral benefits — Non-payment at superannuation — Interest on delayed retiral dues accrues from the date the employee is deprived of the amount legitimately due, i.e., from the date of retirement/superannuation, and not merely from expiry of the period fixed by the Tribunal; employer's failure to explain the delay weighs against it, and delay in retiral dues is viewed strictly as such dues are often the principal source of sustenance in old age — Order of CAT dated 17 May 2024 (OA 2148/2023 batch, para 6 as modified in RA 70/2024 in OA 3290/2023) modified: interest @ 7.5% p.a. reckoned from date of superannuation till principal retiral dues paid; direction enhancing rate to 12% p.a. if payment not made within six months of the Tribunal's judgment stands as is — Reliance on MCD v Bijender Singh, 2024 SCC OnLine Del 7716.

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$~31

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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- W.P.(C) 16960/2024 & CM APPL. 71831/2024

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DR. SHAMOLI KUNDU .....Petitioner Through: Mr. Atul Gupta, Adv. for Mr. Umesh Singh, Mr. Ankit Bhadouria, Advs.

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versus

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MUNICIPAL CORPORATION OF DELHI .....Respondent Through: Ms. Manisha Tyagi and Ms. Monika, Advs.

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CORAM:

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HON'BLE MR. JUSTICE C. HARI SHANKAR HON'BLE MR. JUSTICE AJAY DIGPAUL

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ORDER (ORAL)

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% 06.03.2025

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C. HARI SHANKAR, J.

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W.P.(C) 16960/2024

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1. This writ petition assails order dated 17 May 2024 passed by the Central Administrative Tribunal¹ in a batch of OAs of which OA 2148/2023 stands disposed of.

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2. The petitioner approached the Tribunal as all her retiral benefits had not been paid to him at the time of her retirement. She, therefore, sought disbursal of the retiral benefits along with interest.

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1 “Tribunal” hereinafter

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Signature Not Ver ified W.P.(C) 16960/2024 Digitally Signed By:AJIT KUMAR Signing Da te:0 8.03.2025 15:59:29

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Page 1 of 4

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3. The Tribunal has, by the impugned order, noted that there was delay in releasing the retiral dues of the petitioner. The respondent was, therefore, directed to release retiral dues within three months from the date of receipt of a certified copy of the order of the Tribunal, failing which the petitioner was held to be entitled to interest at the rate of 12% from the date of expiry of the said period of three months.

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4. The petitioner in OA 3290/2023² filed RA 70/2024 before the Tribunal seeking clarification regarding interest. The Tribunal has modified para 6 of its order to read thus:

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“6. In the light of the above facts and circumstances of the case, it is an undisputed fact that there has been delay in releasing the retiral dues to the applicant. Therefore, on the basis of well settled law, as enumerated herein above, all the OAs are disposed with a direction to the respondents to release all remaining retiral benefits due to the applicants from the date of their retirement. While doing so, the respondents shall provide to the applicants due and drawn statement. Interest for delayed payment, at this state, cannot be acceded to as we are informed that the MOD is facing acute financial crises. This exercise shall be done within a period of three months from the date of receipt of a certified copy of this order, failing which all the applicants shall be entitled to interest @ 7.5% from the date of expiry of period of three months. If there is any further delay beyond the period of six months, then the applicants shall be entitled for interest at the rate of 12% instead of 7.5%.”

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5. The petitioner has now approached the Court submitting that his entitlement to interest should reckon from the date of her retirement, as she has been deprived of her retiral dues since then.

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6. We have heard Mr. Atul Gupta, learned Counsel for the

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2 Sh y am Sin g h v MCD

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Signature Not Ver ified W.P.(C) 16960/2024 Digitally Signed By:AJIT KUMAR Signing Da te:0 8.03.2025 15:59:29

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Page 2 of 4

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petitioner and Ms. Manish Tyagi, learned Counsel for the MCD.

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7. Counter-affidavit filed by the MCD in WP C 1494/2025 is taken on record.

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8. There can be no possible dispute with the contention of the petitioner. Interest is an accretion on principal. It becomes due from the time the employee has been deprived of the amount which is legitimately due. The MCD could not, either before the Tribunal or before this Court, offer any explanation for not disbursing the retiral dues of the petitioner at the time when she retired.

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9. In the matter of delay in disbursal of retiral dues, the Court has to adopt a strict stance, as the retiral dues of a conscientious Government servant are at times the principal source of sustenance of the Government servant and his family in the evening of their lives.

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10. In that view of the matter, we have already held in MCD v Bijender Singh³ that an employee would be entitled to interest on retiral dues from the date of his retirement.

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11. Accordingly, we modify the order passed by the Tribunal by holding that the interest at the rate of 7.5% p.a. would be reckoned from the date of the petitioner’s superannuation, and not from the expiry of three months from the order of the Tribunal, till the date when the principal amount of the retiral dues was/is paid. We clarify

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3 2024 SCC OnLine Del 7716

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Signature Not Ver ified W.P.(C) 16960/2024 Digitally Signed By:AJIT KUMAR Signing Da te:0 8.03.2025 15:59:29

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Page 3 of 4

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that the direction for increase in the rate of interest to 12% p.a., in the event the amount is not/has not been paid before the expiry of six months from the date of the judgment of the Tribunal, stands as it is.

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12. The writ petition stands allowed accordingly.

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C. HARI SHANKAR, J.

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AJAY DIGPAUL, J.

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MARCH 6, 2025/ ar

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Click here to check corrigendum, if any

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Signature Not Ver ified W.P.(C) 16960/2024 Digitally Signed By:AJIT KUMAR Signing Da te:0 8.03.2025 15:59:29

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Dr. Shamoli Kundu v. Municipal Corporation of Delhi

Case brief

What is this about?

What did the court decide?

Dr. Shamoli Kundu v. Municipal Corporation of Delhi

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

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