A Srinivasan Vs the Managing Director Bmtc — Writ and Judicial Review | Karnataka HC (2026)

A Srinivasan Vs the Managing Director Bmtc — Writ and Judicial Review | Karnataka HC (2026)

What the court decided

AI extract

Outcome

Interest at 6% per annum on the delayed payment of service/earned leave encashment benefits; failing payment within 12 weeks, interest at 9% per annum, with the respondent-Corporation barred from pleading for reduction of the rate in that event.

Issue for consideration

At what rate of interest per annum are the petitioners entitled on the delayed payment of their earned leave encashment / service benefits by the respondent-Corporation (BMTC) — 9% as urged on the strength of the Division Bench decision in Divisional Controller NWKRTC vs Tanaji (WA No.100193/2024), or 6% as urged by the Corporation citing the Co-ordinate Bench in Sri Yallappa and the Apex Court decision in State of Andhra Pradesh vs Dinavahi Lakshmi Kameswari?

Court's answer

The petitioner is entitled to 6% interest on the delayed payment, the Court taking into account the financial difficulty faced by the petitioner-Corporation, including the unprecedented difficult situation during the Covid period, consistent with the Apex Court having reduced interest to 6% in State of Andhra Pradesh vs Dinavahi Lakshmi Kameswari.

Ratio / Principle

If payment is not made within 12 weeks, the petitioner is entitled to interest at 9% per annum, and in such a situation the respondent-Corporation cannot plead for reduction of the interest rate.

Detailed headnote1 paragraphs

High Court of Karnataka at Bengaluru (HC-KAR), 18-02-2026 — Anant Ramanath Hegde J. (single bench). Thirteen petitioners, under Articles 226 and 227 of the Constitution, sought direction to BMTC to pay interest at 12% per annum on the belated payment of their earned leave encashment benefits (representations dated September 2023, ANNX-C1 to C13). Petitioners' counsel urged 9% per the Division Bench in Divisional Controller, NWKRTC vs Tanaji (WA No.100193/2024); the Corporation urged 6% per the Co-ordinate Bench in Sri Yallappa vs Management of NWKRTC (WP No.106898/2025), which had referred to State of Andhra Pradesh vs Dinavahi Lakshmi Kameswari, (2021) 11 SCC 543, wherein the Apex Court, noticing the APSRTC's financial condition, reduced interest from 12% to 6% — a judgment the Division Bench had admittedly not referred to. The Court held that, given the Corporation's financial difficulty including the unprecedented Covid-period situation, the petitioner is entitled to 6% interest on the delayed payment; however, if payment is not made within 12 weeks, interest runs at 9% per annum and the Corporation cannot plead for reduction of the rate. Petition disposed of accordingly.

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NC: 2026:KHC:10151 WP No. 36274 of 2024

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18^TH DAY OF FEBRUARY, 2026

BEFORE

THE HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE

WRIT PETITION NO. 36274 OF 2024 (S-KSRTC)

BETWEEN:

A SRINIVASAN,

S/O A.G. ANANTHAN, AGED ABOUT 62 YEARS, R/A NO.152, 3^RD B MALN

2^ND B CROSS, BEHIND AYYAPPA TEMPLE, SOMESHWARANAGARA, CHIKKABOMMASANDRA, YALAHANKA NEW EXTENSION, GKVK, BANGALORE 560 065.

Digitally signed by PRAMILA G V Location: HIGH COURT OF KARNATAKA

H. RAMANJANAPPA, S/O HANUMANTHAPPA, AGED ABOUT 62 YEARS, R/A NO.79, 1ST MAIN, 4TH CROSS, ANJANEYASWAMY ROAD, ALLALASANDRA, GKVK, BANGALORE 560 065.

N.G. VENKATARAJU S/O GOVINDAPPA AGED ABOUT 62 YEARS R/A NO.190/4, 1ST STAGE 1ST BLOCK, SRINAGARA BANGALORE 560 050.

S. CHINTHAMANI S/O SUBRAMANYA IYER AGED ABOUT 64 YEARS R/A EWS 78, 4^TH CROSS, GANGOTHRI EXTENSION, SARASWATHIPURAM,

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MYSORE - 570 009.

R.S. CHANDRASHEKHARAIAH, S/O SHIVANNA, AGED ABOUT 65 YEARS, R/A NO.170, LAKSHMI TEMPLE BEEDI, HUNASAMARANAHALLI BANGALORE 562 157.

D. DIVAKARA, S/O DODDAHANUMANTHAIAH, AGED ABOUT 66 YEARS, R/A NO.59/A, DHANWANTHARI, 3^RD CROSS, MARIYAPPANAPALYA, JNANABHARATHI

BANGALORE- 560 056.

T.N. MANJUNATHA, S/O NANJUNDAPPA, AGED ABOUT 66 YEARS, R/A ARALAPETE, GADIKEMPANNA COMPOUND, TUMKUR - 572 101.

P.R. NAGARAJARAO, S/O P.S. RAMASUBBARAO, AGED ABOUT 65 YEARS, R/A NO.5, 1^ST MAIN ROAD, 3^RD CROSS, NEAR SHIVA TEMPLE, UMAMAHESHWARI EXTENSION, KANAKAPURA MAIN ROAD, DODDAKALLASANDRA, BANGALORE - 560 052.

B.S. NARAYANKAR, S/O SHANKARAPPA, AGED ABOUT 65 YEARS, R/A NO.33, KSRTC EMPLOYEES RESIDENCE VINAYAKANAGARA, BANGALORE 560 027.

B.P. NAGESH, S/O B.S. PARAMASHIVALAH, AGED ABOUT 65 YEARS,

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R/A NO.8, BIJJAHALLI, KANAKAPURA TALUK, RAMANAGARA DISTRICT - 562 119.

KUMAR, S/O NANJAPPA, AGED ABOUT 64 YEARS, R/A NO.48, MATHRUSREE NILAYA, 2^ND MAIN ROAD, J.C. NAGARA, MAHALAKSHMI LAYOUT, BANGALORE - 560 086.

R. RAMESHA, S/O C. RAMAKRISHNAPPA, AGED ABOUT 64 YEARS, R/A NO.162, S.R. NILAYA, 2ND MAIN ROAD, 2ND STAGE, WEST OF CHORD ROAD, CT HOPITAL, MANJUNATHANAGARA, BANGALORE - 560 010.

D. GANGADHARA, S/O DASEGOWDA, AGED ABOUT 64 YEARS, R/A GONITUMKUR AT AND POST DABBEGHATTA HOBLI, TURUVEKERE TALUK, TUMKUR DISTRICT - 572 227.

…PETITIONERS

(BY SRI A J R THIPPESWAMY.,ADVOCATE)

AND:

THE MANAGING DIRECTOR, BMTC, BMTC CENTRAL OFFICES, K.H. ROAD, SHANTHINAGAR, BANGALORE - 560 027.

THE CHIEF ACCOUNTS OFFICER, BMTC, CENTRAL OFFICES, K.H. ROAD, SHANTHINAGAR, BANGALORE - 560 027.

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…RESPONDENTS

(BY SMT RENUKA H R.,ADVOCATE FOR R1 AND R2)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO DIRECTING THE RESPONDENTS CORPORATION TO PAY INTEREST AT THE RATE OF 12 PERCENT PER ANNUM TO THE PETITIONERS FOR THE PERIOD OF BELATED PAYMENT OF EARNED LEAVE ENCASHMENT BENEFITS BY CONSIDERING THE REPRESENTATIONS OF THE PETITIONERS DATED 07/09/2023, 14/09/2023, 07/09/2023, 07/09/2023, 14/09/2023, 07/09/2023, 14/09/2023, 07/09/2023, 07/09/2023, 14/09/2023, 07/09/2023, 07/09/2023 AND 19/09/2023 VIDE ANNX-C1, C2, C3, C4, C5, C6, C7, C8, C9, C10, C11, C12 AND C13 RESPECTIVELY.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP , THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE

ORAL ORDER

Heard the learned counsel appearing for the petitioner

and the learned counsel appearing for the respondent.

The dispute is relating to the interest payable on

the delayed payment of service benefits payable to the petitioner-employee by the respondent-Corporation.

Learned counsel for the petitioner would urge that the Division Bench of this Court in The Divisional

Controller, North West Karnataka Road Transport

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Corporation, Dharwad Rural Division and Another vs Tanaji and Others and others¹ has awarded 9% interest on delayed payment and would urge that same rate of interest is to be applied to the petitioner's claim and 9% interest per annum is to be awarded.

Learned counsel for the respondent-Corporation would refer to the judgment of the Co-ordinate Bench of this Court in Sri Yallappa vs. The Management of NWKRTC Hubballi Rural Division and connected matters² and would urge that 6% interest is awarded on delayed payment. It is urged on behalf of the respondent-Corporation that, though the Division Bench has awarded 9% interest, the Coordinate Bench of this Court has referred to the Supreme Court Judgment wherein, the interest is awarded interest at 6% per annum and the Divisional Bench of this Court has not referred to the judgment in State of Andhra Pradesh and

Another vs. Dinavahi Lakshmi Kameswari³ as such, the

1 WA No.100193/2024

2 WP No.106898/2025 & Connected matters

3 (2021) 11 SCC 543

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said judgment is per incuriam.

The Court has considered the contentions raised at

the Bar and perused the records.

In the judgment of the Division Bench referred to by the learned counsel for the petitioner, admittedly, there is no reference to the judgment of the Apex Court in State of Andhra Pradesh (supra) which has awarded 6% interest in case of delayed payment. The Co-ordinate Bench of this Court has referred to the judgment of the Apex Court in State of Andhra Pradesh (supra) which is with reference to a similar- Corporation namely the Andhra Pradesh State Road Transport Corporation and the Apex Court noticing the financial condition of the said Corporation has reduced the interest from 12% to 6%.

Since it is submitted that on account of financial

difficulty faced by the petitioner-Corporation which is also due to the unprecedented difficult situation during Covid period, the Court is of the view that the petitioner is entitled to 6%

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interest on the delayed payment.

However, it is made clear that in case the payment is not made within 12 weeks from today, the petitioner is entitled to 9% interest per annum and in such a situation, the respondent-Corporation cannot plead for reduction of interest rate.

Petition is disposed of accordingly.

Sd/-

(ANANT RAMANATH HEGDE) JUDGE

CHS

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